Is home insurance required? (2025 Coverage Rules)
Home insurance is required by mortgage lenders and some homeowners' associations. No state laws require house insurance, but it's recommended that you carry homeowners insurance, even if not required, to protect your assets. Homeowners insurance rates start as low as $72 per month for $200,000 policies.
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Tracey L. Wells
Licensed Insurance Agent & Agency Owner
Tracey L. Wells is a licensed insurance agent and Farmers insurance agency owner with 23 years of experience. He is proud to be a local Farmers agent serving Grayson, Georgia and surrounding areas. With experience as both an underwriter and agent, he provides his customers with insight that others agents may not have. His agency offers all lines of insurance including home, life, auto, RV, bus...
Licensed Insurance Agent & Agency Owner
UPDATED: Sep 13, 2025
It’s all about you. We want to help you make the right legal decisions.
We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes should be easy. This doesn’t influence our content. Our opinions are our own.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about insurance. Our goal is to be an objective, third-party resource for everything legal and insurance related. We update our site regularly, and all content is reviewed by experts.
UPDATED: Sep 13, 2025
It’s all about you. We want to help you make the right legal decisions.
We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes should be easy. This doesn’t influence our content. Our opinions are our own.
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Is home insurance required? Homeowners insurance is not required by state laws, but your mortgage lender will require home insurance to protect their assets. Your homeowners association (HOA) may also require a level of home insurance coverage.
- State laws do not require homeowners insurance on homes
- Mortgage lenders and HOAs often require home insurance
- Renters insurance is not legally required, but often mandated by landlords
Even if you don’t have a mortgage, having insurance on your home is still a smart choice, as it protects your assets and belongings. Read on to learn about home insurance requirements, from eligibility to costs, the cheapest home insurance companies, and much more.
Looking for protection for your home? Enter your ZIP in our free tool to compare home insurance quotes today.
Understanding Home Insurance Requirements
Does everyone need house insurance? If you are asking is home insurance required on Reddit or other sites, you may be wondering if every homeowner needs to have house insurance. The answer is that while no state laws mandate homeowners insurance. However, you may have conditions from your mortgage lender or HOA that require you to have insurance on your home.
Home Insurance Requirements by Mortgage & Status| Status | Required? | Reason |
|---|---|---|
| Homeowners associations (HOAs) or condo boards | ❓ | If your property is part of an HOA or condo, the bylaws may mandate insurance (even if you don’t have a mortgage) |
| Mortgage with lender | ✅ | Lender requires insurance to protect their investment |
| No mortgage (own home outright) | ❌ | Not legally required but recommended for protection |
| Renting (tenant) | ❌ | Not required by law, but landlords often require renters insurance |
| Mortgage with specific risks (flood, earthquake zones) | ❓ | Special insurance (flood, earthquake) may be required in high-risk areas |
You may also be required to have high-risk homeowners insurance on your home if you live in an area that is a high-risk for flooding, wildfires, or other natural disasters (Read More: Does homeowners insurance cover wildfires?).
As well, even if you rent, you may have to have renters insurance on your home due to the landlord’s requirements. So while home and renters insurance aren’t mandated by state laws, they are still required in a number of different situations.
Determining Eligibility for Home Insurance
Not everyone will have an easy time securing home insurance, due to risk factors like location, credit history, property type, and more. For example, if you live in an area where wildfire claims are common, you may have trouble securing insurance (Learn More: How to File a Home Insurance Claim After a Wildfire).
Home Insurance Requirements| Requirement | Description |
|---|---|
| Ownership Status | Must own the property or have legal rights; renters need renters insurance |
| Property Type | Coverage depends on home type (single-family, condo, townhouse, etc.) |
| Mortgage Status | Lender usually requires insurance; optional but recommended if no mortgage |
| Property Condition | Home should be in good repair; major risks may need fixing |
| Home Value & Coverage Amount | Coverage set based on home and belongings’ value |
| Location | High-risk areas may need extra or special coverage |
| Credit Score | Good credit may be required and can lower premiums |
| Previous Claims History | Frequent claims can increase rates or affect eligibility |
| Home Security Measures | Security systems may give discounts or extra benefits |
| Age of Home | Older homes may need inspections or updates |
| Legal Requirements | Local laws may mandate specific coverage (flood, earthquake) |
If your eligibility for home insurance is affected by risk factors, you will have to shop around more to find an insurance provider that will insure your home. You can also take some measures to improve your eligibility for home insurance and make it less likely that you will be rejected by insurers, including improving your credit score or updating older homes with necessary safety measures after an inspection.
Enter your zip code below to view companies that have cheap insurance rates.
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Factors Affecting Home Insurance Rates
How much is homeowners insurance? Home insurance rates vary drastically based on several factors, even if customers live on the same street. Personal factors like credit score affect house insurance rates, as well as the type of home dwelling and the location of the dwelling.
Even the home security you have on your home can affect what you pay, with more extensive security features on your home lowering rates. This is because homes with more advanced security features are less likely to be broken into and have valuable goods stolen.
Factors Affecting Home Insurance Premiums| Factor | Reason |
|---|---|
| Location | High-risk areas (flood, earthquake) increase premiums |
| Home’s Age & Condition | Older homes or homes in poor condition tend to have higher premiums |
| Coverage Amount | Higher coverage limits lead to higher premiums |
| Claims History | Frequent claims increase the cost of premiums |
| Deductible Amount | Higher deductible reduces premium, but increases out-of-pocket costs in a claim |
| Credit Score | A lower credit score may result in higher premiums |
| Home Security | Having security systems (alarms, cameras) |
The number of claims you have on record can also affect rates, just like with any type of insurance, whether auto insurance or pet insurance.
The monetary value of your home and the home insurance provider you choose will also have an impact on your monthly home insurance costs.
Home Insurance Monthly Rates by Dwelling Coverage| Insurance Company | $200K | $300K | $500K | $1M |
|---|---|---|---|---|
 | $132 | $167 | $210 | $292 |
 | $142 | $178 | $223 | $308 |
 | $156 | $195 | $244 | $338 |
 | $138 | $171 | $213 | $294 |
 | $113 | $141 | $177 | $246 |
 | $122 | $153 | $191 | $267 |
 | $72 | $90 | $111 | $174 |
 | $75 | $91 | $121 | $184 |
 | $74 | $95 | $121 | $187 |
 | $160 | $199 | $234 | $312 |
Who gives the cheapest homeowners insurance? Some home insurance companies that may be more affordable for homes are Kemper, Westfield, or Union Mutual. Companies that may cost a little bit more to purchase home insurance from include Cincinnati Insurance Companies and American Family Insurance.
Home Insurance Rates by State
As we’ve mentioned, there are no homeowners insurance requirements by state, but your location still has an impact on home insurance rates. When you compare homeowners insurance quotes based on where you live, you will see that some states have much more expensive rates than others.
The wide variance in cost between states is due to several factors, such as the cost of living, geographical weather patterns, claim numbers, and more. For example, Nebraska has the most expensive average U.S. premium for a $300k dwelling coverage at $471 per month, while Hawaii has an estimated $96 per month premium.
To find affordable home insurance for your dwelling in an expensive state, we recommend comparing quotes from at least a few companies in your area to find the best deal.
Choosing the Best Insurance Coverage for Your Home
The types of coverage you need for your home depend on your budget and how much you want to spend on home insurance (Learn More: How much homeowners insurance do you need?).
There are several types of insurance that may be beneficial to have on your home, from general dwelling coverage to additional living expenses (ALE).
Types of Home Insurance Coverage| Coverage Type | What It Covers | Example Scenario |
|---|---|---|
| Dwelling Coverage | Structure of the home (roof, walls, floors, etc.) | Fire or storm damage to the house’s structure |
| Personal Property Coverage | Personal belongings inside the home (furniture, electronics, etc.) | Theft of electronics or clothing |
| Liability Protection | Legal responsibility for accidents on the property (e.g., if someone is injured) | If a guest falls on your property and sues you |
| Additional Living Expenses (ALE) | Temporary living costs if the home is uninhabitable (hotels, meals) | Staying in a hotel after a fire damages your home |
| Medical Payments Coverage | Covers medical bills if someone is injured on your property | A guest is injured and needs medical treatment |
Dwelling insurance is a basic part of home insurance policies, and covers the structure of your home. This means that if structures like the walls or roof are damaged, insurance will help cover repair costs. In addition to basic dwelling home insurance, one recommended home insurance coverage is liability coverage for homeowners.
Liability insurance coverage protects you if someone is injured on your property or if property damage occurs to their items (Learn More: Understanding the 8 Types of Homeowners Insurance Policies).
Having liability insurance on your home insurance policy is therefore very important, as it helps protect you if you are sued by someone.
Liability home insurance will help protect you in several cases, such as if your dog bites someone or if someone trips down your steps.
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Another popular home insurance coverage is personal property insurance. This coverage can be for renters or homeowners. Personal property insurance helps provide financial protection for what is inside your home, such as electronics, from theft, vandalism, and other incidents that damage your property or result in loss.
Adding personal property insurance to your home insurance policy ensures that both your home and your belongings are protected.
Ready to find a house insurance policy to protect your belongings and home today? Compare quotes with our free tool today to find the best policy that meets your home insurance needs.
Frequently Asked Questions
Is it mandatory to have home insurance in the U.S.?
No, the United States does not have homeowners insurance laws dictating coverage levels or minimum homeowners insurance requirements for a mortgage.
What states require home insurance?
If you are asking, “Is homeowners insurance required in NY?” or “Is home insurance required in California?” the answer is that no state has home insurance laws or requirements. However, you may have to have home insurance if you have a mortgage or an HOA.
What happens if you have a mortgage and no homeowners insurance?
If you have a mortgage but no home insurance, your lender may purchase insurance that meets the home insurance requirements for mortgages and force you to pay for it, or foreclose on your home. To find home insurance that protects you today, compare rates with our free tool.
What are the minimum homeowners insurance requirements?
There are no set requirements for home insurance that are universal. Lenders, HOAs, and landlords will all have their own requirements for how much home or renters insurance you need to have (Learn More: Best Renters Insurance Companies).
Is home insurance required by law?
No, there is no law that requires homeowners to have home insurance.
Is it okay not to have home insurance?
Wondering can I opt out of homeowners insurance? Although you may not need home insurance if you own your home outright, it is not advisable to do so. Not having home insurance on your home is financially risky and leaves you at-risk for expensive repairs.
Is it illegal to have a house without insurance?
No, it is not illegal to have a home without home insurance. However, if you have a mortgage, your lender may buy expensive insurance on your behalf and charge you for it, so it is best to get coverage on your own (Read More: Homeowners Insurance Coverage Explained).
What percentage of people don’t have house insurance?
According to Census Bureau data, about 13% of Americans do not have home insurance on their homes.
How much is homeowners insurance on a $400,000 house?
Home insurance rates for a $400,000 policy will cost between $100 and $300 per month, depending on where you live and which company you choose. Enter your ZIP code to start comparing homeowners insurance quotes for free.
Can I deduct homeowners insurance on my taxes?
In most cases, you can’t deduct house insurance from your taxes. However, if the home you own is a rental property, then you may be able to deduct insurance as a business expense.
Should I drop homeowners insurance?
It is not recommended to drop home insurance, as it leaves you financially vulnerable. If you need help finding reputable home insurance providers, check out our guide to the best homeowners insurance companies.
What are the alternatives to homeowners insurance?
If you are struggling to find insurance in high-risk areas, such as California, FAIR plans may be an option. Another option is to make sure you have plenty of funds set aside to pay for your home and belongings, but this isn’t practical or feasible for the majority of homeowners.
Enter your zip code below to view companies that have cheap insurance rates.
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Tracey L. Wells
Licensed Insurance Agent & Agency Owner
Tracey L. Wells is a licensed insurance agent and Farmers insurance agency owner with 23 years of experience. He is proud to be a local Farmers agent serving Grayson, Georgia and surrounding areas. With experience as both an underwriter and agent, he provides his customers with insight that others agents may not have. His agency offers all lines of insurance including home, life, auto, RV, bus...
Licensed Insurance Agent & Agency Owner
Editorial Guidelines: We are a free online resource for anyone interested in learning more about insurance. Our goal is to be an objective, third-party resource for everything legal and insurance related. We update our site regularly, and all content is reviewed by experts.
