Home Insurance in Michigan


UPDATED: NOV 2020 | 3 MIN READ

Property values are very reasonable in Michigan, and many of the most common perils facing homeowners in the Great Lake State are automatically covered by even the most basic homeowners insurance policy. Flooding is a problem, but that doesn’t prevent the state from ranking 38 out of 50 states for the most expensive homeowners insurance. 

  • Fun fact  – Did you know that the only authentic Dutch windmill currently operating in the United States is located in Michigan? Wild! 

Average Rates in Michigan

When ranking all 50 states from most to least expensive, Michigan Falls in at #38 on that list. Not only does this put Michigan in the lower half of the most expensive states for homeowners insurance, it is only notched out of the bottom most affordable 10 by states like West Virginia and Pennsylvania. Iowa and Arkansas are slightly more expensive than Michigan, but not by much. Your average Michigan homeowner is only paying around $942 per year for their home insurance premiums, whereas the average American homeowner is paying almost $300 more for theirs.

Now let’s talk about renters in Michigan. The average renter across the United States is paying about $180 a year to protect their belongings and property with a solid renters insurance policy. Renters in Michigan, on the other hand, are paying $182. When you consider the fact that most renters insurance policies are paid in monthly premiums instead of annual premiums, that’s pennies-on-the-dollar more expensive than the national average. So renters insurance in Michigan likely isn’t breaking anyone’s bank, even though it is slightly more expensive.

Michigan Legal Insurance Requirements

Home insurance is fairly simple in Michigan. In other states, certain perils that are unique and common based on the geography and history of the area may require you or your insurance company to purchase or offer specific types of coverage, respectively. But that isn’t the case so much in Michigan. Obviously, because of its proximity to so many large bodies of water, you’ll want to do your best to independently protect yourself from flood-related damage to your home. But other than that, you’ll only be required to purchase homeowners insurance if you are still paying off the mortgage. Once you own your home outright, you don’t actually have to carry insurance on it anymore – but it’s still a very smart idea to do so. 

Common Risk Factors in Michigan

Wind, snow, and floods are the biggest problems you will likely face as a homeowner in Michigan. Luckily, your basic HO-3 homeowners insurance policy easily and adequately covers those first two without drastically spiking your annual premiums. Floods, however, are a different story. Luckily, the FEMA program does sell flood insurance to the vast majority of homeowners for a relatively reasonable rate. If you don’t currently have flood insurance on your home, you should contact the office to get a quote and discuss a policy.

There are rare instances we’re a homeowner may be living in such a high risk area that they get rejected repeatedly for home insurance coverage. If you are forced outside of the standard market, but still need coverage on your home and property, contact the Michigan Basic Property Insurance Association. That is the office that handles FAIR plans for high-risk homes. But you should do your best to try and find standard insurance first, because these policies aren’t cheap and you’ll be getting less coverage while simultaneously paying a higher annual premium. 

Insurance Demographics/Statistics in Michigan

Of course, as a homeowner, natural disasters aren’t the only things you have to worry about. And they aren’t the only thing your home insurance company has to worry about, either. There are other factors at play which can increase or decrease your risk as a customer. The lower your risk, the more likely it is that your insurance company will lower your annual premiums. Conversely, the higher your risk, the more you will end up having to pay.

  • Home Value – One solid, common rule for homeowners insurance is to insure your structure for 80% of its replacement cost value. Because houses in Michigan only cost $176,977 on average – which is around $75,000 cheaper than most homes across the country – you don’t have to purchase as much total coverage on your home. And the less coverage you have to purchase, the lower your premiums will be. 
  • Crime – There is actually a common misconception the property crime is high in Michigan. The truth is that, as a Michigan homeowner, you have a 1 in 60 chance of becoming a victim of property crime in your state. When you compare that to the national average of 1 in 43, this provides more insight into why Michigan homeowners are paying less for their homeowners insurance compared to the national average. 
  • Income – Average incomes in Michigan, however, aren’t doing so great. The average Michigan resident is bringing in $56,697 per year – which is $5,240 less than the national average. Although it seems strange, insurance companies charge higher rates to people with lower incomes on average to financially protect themselves from people paying late or defaulting on their premiums. 
  • Education – The lower incomes in Michigan may have something to do with the lower levels of higher education in the state. On average, 29% of Michigan residents have a bachelor’s degree or more. When you compare that to the national average of 32%, and when you take into consideration the fact that insurance companies like giving discounts to people with higher levels of education, it provides further insight into the economic landscape of the insurance industry in Michigan. 

Where To Purchase Home Insurance in Michigan

There are two main types of advice we can give you when it comes to purchasing homeowners insurance in Michigan. Those tips are: shop around on a regular basis, and do most of your shopping online. Only 44% of homeowners actually bother shopping around for a better rate whenever their policy is up for renewal. Now, we understand that many insurance companies offer financial incentives and loyalty programs for homeowners who stick around throughout the years – but at the same time, you could be overpaying by hundreds or thousands of dollars and leaving money on the table by not shopping around.

Furthermore, of that 44%, only 17% of those people bother to compare quotes online! Given how many tens of thousands of dollars we have saved people over the years at Agile Rates, it boggles our mind how this is even possible. All you have to do is fill out our simple online form and we can help you start comparing quotes and finding a better rate – and possibly a better policy – in a matter of minutes. Our customer service agents are standing by right now, ready and eager to talk to you. What have you got to lose?

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