If you’re buying a house, you’re probably already thinking about homeowners insurance. Protecting your biggest asset is essential, but it’s more than just insuring the structure itself and your belongings. There’s making sure you can keep up with payments, even if something devastating were to happen.
“Insurance is a risk management tool — you should look at all the risks you face and identify what you’re willing to shoulder yourself versus what you want to offload to an insurance company,” said Katherine Sojo, a wealth manager at Evensky & Katz/Foldes Wealth Management in Miami.
Making smart updates to your overall insurance portfolio can protect your home, your family and your peace of mind.
Protect your property and possessions from fire, theft, and other unexpected perils.
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Amica offers two tiers of homeowners insurance: A standard policy and the brand’s Platinum Choice plan, which covers more situations and has extended coverage for jewelry and liability. Add-on options include computer coverage, sump pump backup coverage, and dwelling replacement coverage.
Insurance updates for homeowners
1. Buy homeowners insurance
This one’s a no-brainer. If you’ve taken out a mortgage, your lender likely required you to get homeowners insurance. To make sure you have , multiply your home’s square footage by construction costs per square foot in your area. (An appraiser or insurance agent should be able to get you an estimate.)
To estimate personal property coverage, do a walkthrough of your home and add up the monetary value of your belongings. (Take videos you can refer to if you have to file a claim.) You’ll need to decide whether to cover your possessions’ actual cash value or their replacement cost value. Actual cash value policies are cheaper, but your payout will be reduced by depreciation.
If you have to relocate while your home is being repaired, additional living expense coverage will pay for hotels, meals and other necessities. The cap on this coverage is usually 30% of your dwelling coverage. Most insurers will reimburse for one year of living expenses, though some offer up to two years and there are policies with no limit.
Additional coverage options
- If you want to cover a detached garage or toolshed, you’ll need other structures coverage (also referred to as Coverage B), which is typically 10% of your dwelling coverage.
- An inflation guard clause automatically increases coverage limits at renewal to reflect the increased cost of repairs.
- For an extra $25 to $50 per year, extended replacement cost ups your dwelling coverage by up to 50%. It’s worth considering if you live in a state with a high risk of hurricanes, wildfires or other hazards.
- While it doesn’t cover normal wear and tear, equipment breakdown coverage can pay for the cost of repairing or replacing appliances or home systems damaged by power surges, motor burnout or mechanical failure.
- As a homeowner, you’re responsible for pipes and wiring running into your property. Service line coverage reimburses for damages caused by wear and tear, freezing, electrical malfunction and tree, roots.
2. Look into umbrella insurance
In some cases, it can mean the difference between going bankrupt and remaining financially solvent.
“If you own a home, you’re probably a very good candidate for excess liability insurance,” Sojo said. “It can protect you from a lawsuit if someone tries to take assets from you, whether that’s property or an investment account. “
People with a high net worth are encouraged to take out an umbrella policy, as are homeowners with children, dogs and high-risk features like a swimming pool or a trampoline, or who employ workers in their home.
“Excess liability insurance “is probably one of the cheapest options out there,” says Sojo. A $2 million policy costs about $380 per year.
Travelers, one of our top picks for umbrella insurance, offers plans up to $10 million that also cover legal fees, damages outside the U.S., and events not included in standard liability policies — such as libel, slander, defamation of character, and invasion of privacy.
Travelers Umbrella Insurance
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Cost
The best way to estimate your costs is to request a quote
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Maximum coverage
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App available
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Policy highlights
A Travelers Umbrella Insurance policy comes with all of the protection you need, covering you at home and abroad. These umbrella policies include coverage for libel, slander, and defamation of character, and legal defense costs.
Pros
- High enough coverage options for most typical families
- High ratings for customer satisfaction
Cons
- Quotes and purchasing not available online
3. Take out life insurance
The average mortgage payment is close to $3,000. Factor in other housing expenses, like home insurance, property taxes and utilities, and you’re easily looking at your biggest monthly expense.
“Consider what happens to your lifestyle — what happens to these expenses — if you or your partner were to pass away,” said Sojo. A life insurance policy can ensure there’s money to replace lost income.
“It’s really hard to tell people how much life insurance they need, because everyone has a different situation they’re trying to protect,” Sojo said. “But one way to get a ballpark idea… is to multiply your annual income by 10.”
A term life insurance policy can protect your family during your peak earning years, when you’re still paying your mortgage or saving for your children’s college education.
Term life is only in effect for a limited period — typically 10, 15, 20 or 30 years — but it’s significantly cheaper than permanent life insurance.
A $500,000 term life policy would cost a 30-year-old male about $30 a month, according to Policygenius. The same level of coverage with a permanent whole life policy would run more than $400 a month.
4. Shop for disability insurance
Nearly half of American Gen Z, Millennial and Gen X households reported living paycheck-to-paycheck in 2024, according to a Bank of America study. That’s a situation that would have dire consequences if even one household member was sidelined from work due to a disability.
While life insurance is important, it’s more likely that you’ll face a serious illness or injury during your working years. Disability insurance can replace between 40% and 70% of lost income, but only 35% of civilian workers have access to long-term disability insurance through their employer, according to the U.S. Bureau of Labor Statistics.
If you’ve just taken on a mortgage, find out if your job offers disability coverage. If not (or if you’re self-employed), consider buying a policy. Insurance marketplace Breeze lets you instantly compare quotes from several insurers and choose the one with the optimum benefits and rates.
Breeze Disability Insurance
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Policy highlights
Online policy broker Breeze allows you to compare rates for short- and long-term disability from Guardian, Mutual of Omaha, Assurity, Ameritas, Principal, MassMutual and other top providers.
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Age
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Benefits period
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Elimination period
5. Ask about insurance discounts
After you close on your house, let your car insurance provider know. Many will consider your status as a homeowner favorably when calculating your rate. According to The Zebra, homeowners pay about $166 less a year for auto insurance than renters.
You might consider enrolling in home insurance with the same company you get your auto policy with. Most insurance companies offer for signing up for multiple policies. The most common incentive is for pairing auto and home, but you can find reductions with renters, umbrella, life and even pet insurance.
“You should try to bundle everything,” Sojo said. “Sometimes that means more discounts than you anticipated.”
State Farm offers as much as 25% off for bundling, and Amica shaves up to 30% when you combine home, umbrella and life insurance.
State Farm Homeowners Insurance
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Cost
The best way to estimate your costs is to request a quote
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Maximum coverage
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App available
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Policy highlights
State Farm’s homeowners insurance offers coverage that’s easy to bundle with other types of insurance and covers things like fire, theft or vandalism. It offers several discounts for home security systems and wind mitigation.
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Does not cover
Business or professional services, damage from flooding or underground water, earthquakes or mudslides, settling or deterioration, and animals, birds or insects.
Amica Homeowners Insurance
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Coverage
Dwelling, other structures, personal property, additional living expenses, personal liability and medical payments.
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Policy highlights
Amica’s Platinum Choice plan comes with 130% dwelling coverage, increased valuable coverage and higher limits for liability and medical payments.
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Add-ons
Dwelling and property replacement, coverage for computers, identity fraud, water backup and home businesses
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Bundling discount
Up to 30% when you combine auto, home and life insurance
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Availability
Amica offers homeowners insurance in all U.S. states except Alaska and Hawaii.
Bundling doesn’t automatically mean you’re getting the best rate, however. If auto insurance with one carrier is more expensive than with another, a discount may not offset the difference.
Get quotes with the same coverage levels and deductibles, Sojo said, “and see who has the best to offer with what you’re looking for.”
Insurance FAQs
How much does homeowners insurance cost?
In September 2025, homeowners insurance premiums averaged $2,408 per year, according to Bankrate data. Rates can vary widely by location; however, and states impacted by severe weather typically pay more. A policy with $300,000 of dwelling coverage averages $1,219 in Maine, for example, but runs about $5,838 in Florida.
Who has the cheapest homeowners insurance?
Individual rates will vary based on your location, claims history and the age and condition of the house, but Nationwide, Amica and USAA have some of the lowest average rates of the insurers we’ve reviewed.
Is car insurance cheaper if you own your home?
While many factors affect auto insurance premiums, data from Experian shows that homeowners typically pay about 10% less than renters. Some providers offer discounts for homeowners, while others let policyholders save by bundling home and auto plans.
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Meet our experts
At CNBC Select, we work with experts who have specialized knowledge and authority, grounded in years of training and experience. For this story, we interviewed Katherine Sojo, a wealth manager at Evensky & Katz/Foldes Wealth Management. Katherine earned a master’s degree in finance from Florida International University and has been a certified financial planner for over 10 years.
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At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice to help them make informed financial decisions. Every insurance article is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of insurance products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.
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Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
Clinton Mora is a reporter for Trending Insurance News. He has previously worked for the Forbes. As a contributor to Trending Insurance News, Clinton covers emerging a wide range of property and casualty insurance related stories.