If you’ve been told in the past that you are ineligible for homeowners insurance, don’t fret. You do have options. Even if you have high-risk characteristics, some homeowners insurance companies will offer you policies, you just have to find them. 

Use Insurify’s comparison tool to find insurance quotes quickly for comprehensive and affordable homeowners insurance.

What Makes You High-Risk

Insurers consider you high-risk if they believe you are more likely to file a claim than the average homeowner. Several factors can make you a higher risk to insurance providers. Understanding what makes you a bad risk for a home insurance policy is the first step to improving your situation.

  • Low credit score: Historically, people with lower credit scores file more home and auto insurance claims and cost the insurance company more money.
  • Prior claims history: If you have a long history of insurance claims, it makes you less attractive to insure. If you are offered coverage, you may have to pay a higher premium. Insurance companies have access to your claims history through your Comprehensive Loss Underwriting Exchange (CLUE) report. The CLUE report details the types of losses you’ve had and the amounts paid by the insurance company.
  • Living in a high-risk area: High-crime areas are at greater risk of home thefts and cost more to insure because of this. Areas prone to natural disasters are also considered high-risk. Coastal areas like North Carolina, Florida, and Texas are at greater risk due to the likelihood of hurricanes during the annual Atlantic hurricane season.
  • Lapsed insurance policy: Letting your home insurance policy lapse reduces the likelihood of being offered home insurance coverage. The insurance company will be unsure whether you will pay your premium on time or at all.
  • Owning dangerous dog breeds: Owning certain dog breeds can make your homeowners insurance more expensive. This is because dangerous dog breeds are more likely to bite others and pose a liability risk. 
  • Owning an older home: An older home has more potential issues than a new home, which is why they generally cost more to insure. For example, aging roofs make it more likely you will experience a leak and water damage to your home.
  • Operating a home business: Operating a home business doesn’t automatically exclude you from coverage. However, depending on the nature of your home business, you may instead be required to purchase a business insurance policy. If you only have a small home business, you may be able to add coverage to your home policy through a policy endorsement.
  • High-hazard home features: When considering whether to insure your home, the insurance company considers if you have hazardous features in and around your home, like a wood-burning stove, a wooden roof, trees with low-hanging limbs, trampolines, or swimming pools. Any of these features could make you more likely to have a home insurance claim.
  • Your home is in need of repair: If your home is in disrepair, you may need to bring it up to today’s standards before an insurance provider will be willing to offer you home insurance.

High-Risk Home Insurance and the FAIR Plan

Your state’s department of insurance may participate in the Fair Access to Insurance Requirements (FAIR) plan. This is a last resort for homeowners who do not qualify for coverage through the standard homeowners insurance market because of their home’s location or other risk factors. With a FAIR homeowners policy, you will have a home insurance plan that satisfies mortgage lender requirements, including personal property coverage for things like natural disasters like wildfires, windstorms, and vandalism and liability coverage.

The FAIR plan may also have certain requirements you must meet before being eligible for coverage, including making required home repairs, installing home security devices, and replacing outdated home systems like wiring or HVAC systems. If you do qualify for a FAIR homeowners policy, you can expect to pay a higher rate than if you buy a policy through private insurers.

If you still have questions about the FAIR plan, contact your insurance agent to discuss further and find out what your coverage options are. If you don’t have an insurance agent, your state insurance department can help you locate a licensed agent in your area who can offer you FAIR home insurance coverage.

Consider All Your Options

If you haven’t had any luck so far finding affordable home coverage because of your risk factors, don’t be discouraged. With a little research and by carefully comparing your coverage options, you can find the right policy for your coverage needs. High-risk homeowners insurance through a FAIR plan can be very expensive and offer less coverage than a traditional homeowners policy. Don’t think you must choose coverage with the FAIR plan before you’ve taken the time to consider all your options with private insurance companies

Frequently Asked Questions

How do I lower my homeowners insurance premium?

It makes sense to keep your home insurance premium as low as possible, but this may be difficult if you are considered high-risk. One easy way to lower your premium is to qualify for discounts by installing home security devices. You can also ask for a higher deductible, which will reduce the cost of your policy. But keep in mind you will also have to pay more money out of pocket if you have a claim. Bundling your home and car insurance can also qualify you for a home insurance discount.

How do I make myself a better risk for homeowners insurance companies?

The bigger the risk you are to home insurance companies, the more your insurance premium will cost. You can make your home less of a risk by updating old home systems, such as wiring and HVAC, and staying on top of maintenance and repair issues. You should also work on improving your credit score to help you qualify for the lowest home insurance rates.

Does Allstate insure high-risk homeowners?

Allstate offers several levels of property insurance to all types of homeowners, including homeowners considered high-risk. An Allstate insurance agent will talk to you and help you find a plan that works for you. Policyholders can purchase and service their policies online or through a local Allstate agent.

Finding Your Best High-Risk Home Insurance Option

If you’ve had trouble meeting eligibility requirements for homeowners insurance coverage in the past, it doesn’t mean you won’t be able to find coverage. Carefully compare home insurance quotes to find your best options, and work on things like improving your credit score or installing home security devices to help you qualify for the best rates.

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Updated June 26, 2021

Janet Hunt received her B.S. in Business Administration with the University of Phoenix. She has worked in the insurance industry for over 20 years. Janet likes to spend her spare time coming up with gourmet recipes and trying them out on her guests. So far, all have survived.