The average cost to insure a U.S. home in 2004 was $729, according to the most recent National Association of Insurance Commissioners (NAIC) data. The cheapest state was Idaho, where the average home insurance premium was $448. In Texas, the most expensive state, it was $1,362, or 2.5% of the average Texans' household income. And that's with adjustments brought on by 2003 legislation that tightened regulations and eliminated many exemptions in the insurance business. Since then, Texans' rates have lowered by about 13%.
"Every disaster known to man can happen in Texas, even earthquakes," says Jim Hurley, a spokesman for the Texas Insurance Department, a state organization for insurance agents and consumers. "We'd love to be lower on the list, but our geography and weather patterns won't allow it."
Texas
Average Annual Premium: $1,362
Take all the country's collective disasters and you have the Lone Star state, where insurers try to make a profit despite hurricanes, tornadoes, hail, windstorms and earthquakes. At an average premium rate of $1,328, it tops our list. The good news for Texans is that rates are going down thanks to 2003 regulations. What's more, the rest of the country is closing the gap.
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