Home Insurance in Utah

WRITTEN BY: Amelia Ciffone

UPDATED: MAY 24, 2022 | 3 MIN READ

Utah has remarkably cheap home insurance and high average household incomes – a useful combination in a state at extreme risk to property damage from wildfires. While buying home insurance is an important undertaking, diving into the particulars of how home insurance works can be intimidating. A good way to begin is by taking a look at how average policies are priced, as well as what kinds of coverages are typically offered.

  • Fun fact:  The mountains near Salt Lake City, Utah average 500 inches of snowfall per year. Thank goodness home insurance protects homes from roof damage from all that snow!

Average Rates in Utah

Utah has some of the cheapest home insurance rates in the country, according to the Insurance Information Institute. With average annual premiums of $692, the only place with cheaper home insurance is Oregon ($677 annual premiums). Its average rates are less than two thirds the national average for home insurance premiums, $1,211.

Although renters’ insurance doesn’t vary much from state to state, the average premiums of $151 in Utah place it in the top ten most affordable states for renters’ insurance. This is nearly $30 below the national average of $180. States with comparable renter’s insurance include Virginia ($152 average premiums) and New Hampshire ($149 average premiums).

Utah Legal Insurance Requirements

Buying home insurance in Utah isn’t a legal requirement, but a contractual one. No state law will force you to purchase health insurance, but if you take out a mortgage, you will either need to buy home insurance that you choose or accept the insurance your lender chooses for you.

The National Association of Insurance Commissioners act to help standardize home insurance coverage across the country. Due to their regulations, you can expect the following kinds of coverage in Utah:

  • Dwelling Coverage. This is the lion’s share of your home insurance, and protects you from damage to the structure of your home and attached buildings. It also can protect systems in the home, like plumbing and electrical wiring.
  • Other Structures Coverage is insurance that will protect from the same damages as dwelling coverage. It applies to man-made structures not attached to your residence – including sheds, garages, fencing, and even sidewalks. Usually the coverage limit is much smaller – 10% of your dwelling coverage is standard.
  • Personal Property. This will insure personal belongings, whether they are lost and damaged inside the home or outside of it. Coverage limits are usually half of your dwelling coverage. While personal property insurance is designed to protect furniture, appliances, and clothing, expensive luxury items receive little coverage and may require endorsements. Some examples of luxury items include art collections, weapons collections, antiques and jewelry
  • Loss of Use. If you have to live outside of your home during repairs (for an insured peril) this will assist in paying “extra” costs to maintain your standard of living. This can range from storage fees and motel bills to groceries.
  • Personal Liability and Medical Payments. This insurance comes into play should someone or their property be harmed by you or a family member. If you’re sued for injury to people or properties due to your negligence, personal liability insurance will help pay for legal expenses. If someone is accidentally injured on your property (not yourself or a family member), medical payments can be made to an extent, helping pay for hospitalization fees, outpatient care, and so on.

Utah insurance will come in different “forms.” What these forms are called varies from company to company, and each form covers a different range of “perils” or damaging events. Utah insurance forms follow certain patterns, described below:

  • The Dwelling Fire Form is the simplest form available, which covers fire, smoke, windstorm, hail, lightning, explosions, vehicles, and civil unrest.
  • The Basic Form covers the same perils as the Dwelling Fire Form, plus theft and vandalism. The Modified Coverage Form provides the same coverage as Basic Form, but insures based on actual cash value rather than replacement cost. It is most often offered for older homes.
  • The Broad Form covers the same perils as the Basic Form, along with: falling trees, the weight of ice or snow, and insurance for the sudden accidental rupturing, overflow, or freezing of plumbing, heating, air conditioning, and fire sprinkler systems
  • The Special Form, the most popular type of home insurance, insures for every peril, save for exceptions that are listed on your insurance policy. Common exclusions include flood, earthquake, war, and nuclear accidents
  • The Tenant’s Form and Condominium Unit Owners Form give Broad Form coverage to personal property, but NOT the complete external structure of the property. Condominium owners, in addition to personal property coverage can insure the walls and floors that they personally own (rather than insuring the entire condominium complex).

Common Risk Factors in Utah

Utah has a varied climate and terrain – wide plains and mountains, dry windy summers that can turn the state into a tinderbox and severe winter storms that can cause avalanches from heavy snow. This can put Utah properties at risk of damage, which may or may not be covered by standard home insurance:

  • Floods. As with most of the United States, floods are a significant risk to Utah homes. Water damage can warp supporting structures, causing building collapse, and personal property can be completely destroyed by flooding. Not only that, but damage from debris and hazardous materials carried into the home by flood pose a threat. Flood damage is not covered by Utah home insurance, and must be purchased from the National Flood Insurance Program, provided you live in a participating community.
  • Landslides are both common and difficult-to-predict hazards in Utah’s mountainous regions. Utah’s Geologic Survey also notes that landslides are among the most economically costly natural disasters in the state – causing infrastructural damage, property damage, loss of life, and secondary disasters, like flooding from a blocked riverflow. Landslides are not covered by Utah home insurance, and there aren’t specific endorsements, as there are for the less common and less damaging earthquakes. Talking to an insurance agent may be the best way for you to obtain insurance for landslides in Utah.
  • Wildfire. 2019 findings from the Insurance Information Institute rank Utah among the top 10 states where properties are most at risk of wildfire – 14% of the state’s properties are currently at risk of damage. Although all types of home insurance cover damage from wildfires, you can help mitigate the risk to your property by buying a home in proximity to a fire station, installing sprinkler systems, or having fire extinguishers close on hand.

Insurance Demographics/Statistics in Utah

You may wonder – what things affect the price of home insurance? Is there anything you can do to decrease the price of your home insurance? The value of your home and the materials it’s constructed with play a big role in pricing – but so can local crime rates. Even your personal characteristics as a homeowner can influence the final price of your home insurance.

Your Home’s Value

Possibly the greatest contributor to the price of your home insurance premiums is your home value. Most of your coverage types have limits that are based around your home value, which is calculated in one of two ways. First, there’s replacement cost. This is the amount of money it takes to completely rebuild your home using similar materials and taking into account current construction costs. Second, there’s actual cash value. This is essentially replacement cost, minus any deductions to value that may occur because of age, wear and tear, or pre existing damage.

It’s important to remember that home value is not the same thing as sale price. When you buy a home, included in that price is the cost of the land attached to it. Insurance companies are only really interested in the physical materials comprising your home’s structure when calculating home value.

In Utah, home values are relatively high – $373,049 compared to the national average of $248,857. This may set the base price for home insurance higher.

Local Crime Rates

Insurance companies may set home insurance premium prices higher in places with high property crime, to offset the risk of a property owner filing a claim in these areas. In Utah, property crime rates are higher than average. According to the FBI Uniform Crime Report, in 2018 the rate for property crime (minus car theft) in Utah was 2.13% – higher than the national rate of 1.97%.

Your Income and Education

Some of your personal characteristics can also factor into the eventual price insurance companies will ask you to pay for home insurance. Much of the time, people with good credit are considered less likely to file an insurance claim – and can obtain more competitive prices as a result. Demographics associated with good credit include people with higher household incomes and a college education.

The good news is that Utah incomes are both higher than the national average, and more people attend college. According to 2018 information from the Census Bureau, the average household income in Utah was $71,414, compared to the national $64,179. Also, while nationally 32.06% of people aged 25 or above have obtained a bachelor’s degree or higher, in Utah the rate is 33.3%.

Where to Purchase Home Insurance in Utah

Now that you have a grasp of how the typical home insurance plan works in Utah, you’re equipped to begin comparing the plans and prices of different companies. Agilerates.com can put the information you need at your fingertips, giving you accurate quotes from insurers in your area. A price comparison can be useful even if you already have homeowners insurance. According to the Pulse Whitepaper from iii.org, only 44% of homeowners compare prices of different insurers at renewal time, and only 17% do so online. That means more than half of all homeowners are leaving money on the table at renewal time. Use Agilerates.com online form to get matched with a local agent, get free quotes, and shop around!