What are the factors that affect hazard insurance (homeowners insurance) estimate?


There are various factors that affect the determination of your mortgage insurance premium. Insurance companies look at a number of aspects, ranging from the very personal to public, to evaluate the risk on a house.

Here we'll look at some of the major factors that affect the estimation of hazard insurance (homeowner's insurance).

Factors affecting Hazard Insurance Estimate

Location of the House:

The location of the house is a big consideration for insurers. If the house is in an area with a high crime rate, the risk increases and so does the insurance premium.

Also, it is possible that the house is in an area prone to natural disasters like hurricanes and earthquakes etc. If you want your home to be insured against that risk then you have to pay extra because standard insurance policies do not cover that.

Condition of the House:

Before insuring a house, insurers inspect it for signs of wear and tear. A place that has problem with electricity, plumbing, etc. is susceptible to a higher insurance cost.

Build Quality of the House:

The materials used in the construction of the house matter to insurers because certain types of materials are more resistant to damage than others.

Security Features:

If the house is secured with strong door locks, deadbolts, burglar alarms etc. then the risk of theft decreases and that is why insurers include this factor to determine insurance premium.

Age of Residents:

The age of residents is also a factor in hazard insurance estimation because older people are more responsible and less accident prone than the young ones. Also, there are certain discounts available for senior citizens.

Smoking Habits:

Smoking is fire risk and the more residents in a home smoke, the more the insurance premium rises.

Other Insurances:

If you are working with the same company to provide you hazard insurance, that provides you other coverage (like health, auto etc.) as well, then there is a good chance you can get a customer loyalty discount on your premiums.

Mortgage rates hit their lowest since 1955. Ask the home loan experts we recommend Quicken Loans how to take advantage of them.
Was this Mortgage QnA helpful?
Not at all
  • Currently 2.9/5 Stars
  • 1
  • 2
  • 3
  • 4
  • 5
Add to this Answer

Mortgage QnA is not a common forum. We have special rules:

  • Post no questions here. To ask a question, click the Ask a Question link
  • We will not publish answers that include any form of advertising
  • Add your answer only if it will contrubute to the quality of this Mortgage QnA and help future readers
If you have trouble reading the code, click on the code itself to generate a new random code. Verification Code Above:
Bookmark and share this QnA: