UPDATED: MAY 24, 2022 | 2 MIN READ
Louisiana is the most expensive state in the US when it comes to homeowners insurance. Its low-lying terrain along the Gulf Coast and sprawling waterways make homes frequently vulnerable to hurricane, named-storm, and flood damage. But it’s not hopeless – you too can find affordable homeowners insurance in Louisiana with our help!
- Fun fact – The Lake Pontchartrain Causeway, measuring 24 miles in length, is the longest overwater bridge in the entire world!
Average Rates in Louisiana
Many people – especially those who live and own homes in Louisiana – may not be surprised to learn that this is the most expensive state when it comes to annual homeowners insurance premiums. Your typical Louisiana homeowner is paying around $1,968 per year for adequate coverage. When you compare that to the national average of $1,211, that’s a good chunk of money. Florida and Texas come in at second and third place, respectively.
Many residents in Louisiana either can’t or won’t purchase a home – so they decide to rent instead. Renter’s insurance rates suffer from similarly expensive price hikes. Although the average annual rate for renters insurance across the u.s. is $180 a year, most Louisiana renters are paying $235 per year. That’s a pretty significant jump!
Louisiana Legal Insurance Requirements
What arguably good thing about homeowners insurance is that as long as you have paid off the mortgage or housing loan on your property, you are not legally required to purchase this form of insurance coverage. Lenders will usually require it in order to protect their investment while you are paying off the loan. But since so many homeowners in Louisiana are living in high-risk areas where floods and other damaging perils can occur, it would likely be foolish to go without coverage – even if you own your home outright.
Common Risk Factors in Louisiana
The consequences of climate change, along with a string of bad luck, has seen the gulf coast of Louisiana get slammed with one hurricane after another on pretty much a yearly basis. Furthermore, many homes in northern parts of the state are located in low-lying areas where seasonal thunderstorms in flood-prone rivers can cause a lot of damage. Be sure to talk with your homeowners insurance agent to check and see which perils are covered under your insurance policy, and which ones – like those caused by flooding associated with river overflow or hurricanes – need special coverage.
The National Flood Insurance Program is the go-to coverage for homeowners who are worried about damage caused by floods. You may also be able to find private insurance that will cover flood damage, although it will likely be completely separate from your homeowners insurance policy. And if your home is located in a particularly high-risk area, you may get repeatedly rejected for standard insurance coverage. If this is happening to you, you may be able to get coverage through the FAIR program in Louisiana. The Louisiana Citizens Property Insurance Corporation is currently underwriting FAIR insurance for the state. But these programs will be expensive and you won’t get as much coverage as you would with standard homeowners insurance, so we highly recommend you shop around first and try to find standard insurance coverage before you settle for this last resort type of policy.
Insurance Demographics/Statistics in Louisiana
When it comes to home insurance, the natural disasters which happen most often and which cause the most damage in your area will have the greatest impact on how much you pay. But there are other (and seemingly unrelated) factors at play which may also raise or lower your insurance premiums. In the state of Louisiana, those variables are:
- The price of your home – One thing Louisiana homeowners have going for them is the fact that average home prices in Louisiana are almost $80,000 cheaper than the national average at $170,388. Why is this good for homeowners insurance premiums? Because most lenders only require you to purchase 80% of your home’s replacement cost. As you may already know, when it comes to Insurance, the less coverage you need to purchase, the more money you save on your premiums.
- Property crime statistics – One thing working against Louisiana homeowners, on the other hand, is the frequency of property crime. While the national average is 1 in 43, Louisiana homeowners have a 1 in 31 chance of becoming a victim of property crime each year. Because property crime is more frequent, you’re more likely to be a higher risk for filing claims against property damage and/or theft. So you will likely have to pay more as a result of this for your insurance premiums.
- Your annual income – Insurance companies, although it sounds counterintuitive, usually offer lower premiums to people who make higher incomes. They see the higher income as a sign of financial stability and, therefore, lower risk. Based on the average income level of Louisiana residents (which is approximately $47,905 a year, or $14,000 lower than the national average) this may provide another explanation as to why Louisiana home insurance premiums are more expensive than in other states.
- Your education level – Another sign that you may be a lower-risk investment, according to insurance companies, is whether or not you have higher education under your belt. The majority of insurance companies out there usually give at least modest discounts to customers who have a bachelor’s degree or more. Seeing as how only 24% of Louisiana homeowners – which is lower than the national average of 32% – have a bachelor’s degree or higher, this may help further explain why Louisiana is the most expensive State when it comes to home insurance premiums.
Where To Purchase Home Insurance in Louisiana
We here at Agile Rates have a lot of experience in the home insurance industry. And we can tell you that there are two main mistakes homeowners make that cost them thousands of dollars over the course of their lifetime: they don’t shop around for better rates on an annual basis, and they don’t comparison-shop online.
Only 44% of people who own their own home bother to at least shop around and see if there aren’t better rates available each year when their home insurance needs to be renewed. What’s even more unbelievable is that of those who do shop around, only 17% are comparing rates among different companies online. That’s hard to believe! It’s so much easier and quicker to compare quotes online at websites like ours than it is to call around and get quotes directly from insurance companies. And if you do it with us, you know that based on our seasoned experience in the industry, we will only show you the best quotes from the most reputable companies near you. So start shopping with us today, and get ready to save a ton of money!