How Moving Affects Your Auto and Homeowners Insurance

Whether you’re moving just down the street or across the country, there’s a high probability that your auto and homeowners insurance will be affected. Make sure to research pricing when considering different neighborhoods to move into, as the smallest change in environment can drastically impact your premiums. Below are some of the factors that affect auto and homeowners insurance rates in different locations.

Your auto insurance rates are directly impacted by the risks associated with the location you live in. Living in a neighborhood that your insurance company considers “high-risk” can result in higher premiums. A neighborhood’s risk level is determined by population density, number of car accidents, traffic, crime rates, severe weather events, frequency and cost of claims, and more.

Moving to a big city usually results in higher auto insurance premiums due to higher rates of vehicle theft and vandalism and increased traffic. However, moving to a more rural location can translate to increased premiums if there are more deer in the area, frequent tornadoes, or if your daily commute is longer (the more you drive each day, the higher your chances of getting into an accident).

All risks considered, the states with the highest average auto insurance premiums are Louisiana, Michigan, and Florida. The least expensive states for auto insurance are North Dakota, Maine, and Iowa. Disclosure 1 1 Insurance Information Institute, “Top 10 Most Expensive And Least Expensive States For Automobile Insurance, 2017,” https://www.iii.org/table-archive/20997 accessed March 2, 2021. Regardless of where you move, remember to inform your insurance carrier as soon as possible in order to avoid billing issues or denied claims. If you’re moving out of state, you’ll need a whole new policy, so it’s best to give your agent a call ahead of time.

Similarly to auto insurance, there are numerous factors that determine whether or not the location of your new home is considered “high-risk.”

Age of home

• Older homes have older wiring systems, which increases your risk of an electrical fire.
• An older home could have an outdated plumbing system that could lead to costly plumbing mishaps.
• Older neighborhoods have older sewer systems, which increases your risk of a sewer backup.
• Since there are increased risks to buying an older home in an older neighborhood, your homeowners insurance premium could potentially increase as well.

Fire stations

• Look for houses located within five miles of a fire station, as their close proximity to fire rescue tends to result in more favorable rates.
• If the small, rural town you’re moving to is serviced by volunteer firefighters, you’ll most likely see an increase in premiums.
• On the other hand, living in a big city with high crime rates and an increased risk of burglaries usually means increased rates as well, regardless of how close you are to a fire station. Disclosure 2 2 Coverage, “How Does My Location Affect My Home Insurance,” https://www.coverage.com/insurance/home/how-does-my-location-affect-my-home-insurance/, accessed March 2, 2021. 

Location

• Severe weather events such as tornadoes, wildfires, hurricanes, and hail storms make areas prone to such disasters high-risk.
• While living along the water is a delightful option, insurance rates for coastal properties have been steadily rising over the last several years due to increased hurricane activity.
• The states with the lowest average homeowner’s premiums are Idaho, Utah, and Oregon. The states with highest average homeowners rates are Louisiana, Florida, and Texas. Disclosure 3 3 Insurance Information Institute, “Facts + Statistics: Homeowners and renters insurance,” https://www.iii.org/fact-statistic/facts-statistics-homeowners-and-renters-insurance, accessed March 2, 2021.
• While Florida, Texas, and Louisiana are well-known for devastating hurricane activity, Texas and Louisiana are also ranked in the top ten states with the most tornadoes each year. Disclosure 4 4 Insurance Information Institute, “Facts + Statistics: Tornadoes and thunderstorms,” https://www.iii.org/fact-statistic/facts-statistics-tornadoes-and-thunderstorms, accessed March 2, 2021.
• To avoid higher rates, try to avoid high-risk areas.

Preparing for a move can be stressful and time-consuming – let us help you. Contact your McGriff broker today to discuss how moving might affect your insurance rates.