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The average monthly cost of home insurance in Arizona is $117, largely due to the year-round threat of wildfires that residents face. Thankfully, most homeowners insurance policies in Arizona cover this peril.
However, traditional policies might not cover other forms of damage, such as flood damage. Insurers like Liberty Mutual, Commonwealth Casualty, Amica, Travelers, and Elite Insurance Group are some of the best in Arizona, though it’s important to understand what coverages their homeowners insurance policies include and exclude.
Table of contents
- Best home insurance companies in Arizona
- How much is homeowners insurance in Arizona?
- How location affects home insurance rates in Arizona
- What are the cheapest home insurance companies in Arizona?
- How much homeowners insurance do you need in Arizona?
- What are some of the biggest risks when owning a home in Arizona?
- How can you save money on homeowners insurance in Arizona?
- What if you have to replace your home in Arizona?
- Arizona homeowners insurance FAQs
Best home insurance companies in Arizona
Many quality home insurance companies provide coverage to homeowners in Arizona, including national insurers like State Farm, Nationwide, Allstate, and Travelers.
The best insurer for your home might not be the largest, the cheapest, or the one with the highest customer satisfaction rating. Instead, the best home insurer is one offering a policy that provides the coverage you need at a premium that you can afford.
Below is a list of insurers working in Arizona. Review them based on the criteria that meet your needs.
Best insurer for cheap rates: Commonwealth Casualty
Average monthly cost: $77
Commonwealth Casualty Company is an insurance provider based in Phoenix and founded in 2010. It provides homeowners, automotive, and renters insurance policies. Its home insurance products include liability coverage for property damage, repair/rebuild coverage, and personal property coverage.
Based in Phoenix and may have a more detailed understanding of local claims risks than national insurers
Provides water backup protection coverage, service line coverage, and special computer coverage under its homeowners insurance policies
Offers nearly a dozen discounts, including multi-policy discounts and discounts for having protective devices, like fire alarms, installed in the home
Fewer than 20 years old, so it doesn’t have a long history of providing insurance products
Lacks coverage products for boats and recreational vehicles compared to other insurers, limiting opportunities to bundle
No online or mobile services; policyholders must call the company to file a claim and complete other tasks
Best large insurer: Liberty Mutual
Average monthly cost: $87
Liberty Mutual is the sixth-largest property and casualty insurer in the world, operating in 29 countries. In 2022, it received 805 out of 1,000 points in the J.D. Power U.S. Home Insurance Study.
A+ BBB rating and accreditation
An A financial strength rating according to A.M. Best, Moody’s, and Standard & Poor’s
Multiple homeowners discounts, including those specifically for new homes and newly renovated homes
Low J.D. Power ranking: In the 2022 study, it ranked 15th out of 21 insurers
1.5 out of 5 stars on BBB with an average of 929 customer reviews
NAIC Complaint Index of 2.22, which is a higher complaint index than some other larger insurers
Best for wildfire coverage: Amica
Amica’s Standard Choice policy provides coverage for property damage caused by fire and lightning. Based in Rhode Island, the company was founded in 1907.
Scored 840 out of 1,000 in the J.D. Power 2022 U.S. Home Insurance Study of Overall Customer Satisfaction
More than 100 years of experience offering fire insurance
One-third of policyholders have been with Amica for 20+ years
Its only Arizona office is located in Phoenix
Even though it offers nationwide coverage, it’s not one of the largest insurers by market share in the country
No independent agents, which could limit opportunities to comparison shop for Amica products
Best insurer for high-value homes: Travelers
Average monthly cost: $124
With more than 150 years of insurance experience, Travelers is a good choice for high-value home insurance in Arizona. It regularly ranks as one of Fortune’s “World’s Most Admired Companies” and provides insurance products across the U.S., U.K., Canada, and Ireland.
Offers expanded coverage for high-value homes
Exclusive discounts for employer, association, and credit union groups
Low J.D. Power Score: Achieved a 794 out of 1,000 rating in overall customer satisfaction for 2022, falling behind more than 20 competitors
Lower BBB Rating: An A, with 1.08 out of 5 stars
Higher average monthly costs
Best regional insurance company: Elite Insurance Group
Elite Insurance Group is located in Gilbert and provides homeowners, renters, and condo insurance. It claims an average annual rate reduction of 57% for its policyholders.
Provides multiple products, like home and RV coverage
Offers commercial insurance products
Limited company history and little information online
No way to file a claim online, no mobile app
Not centrally located for all state residents
To evaluate home insurance companies, Insurify data scientists and editorial team analyze multiple factors that reflect a company’s quality, reliability, and financial health. We consider industry ratings and information from sources like A.M. Best, Standard & Poor’s, Moody’s and Fitch, and J.D. Power. We evaluate customer service and satisfaction data, customer reviews, NAIC complaint indexes, claims payout rates, company reputation and proprietary quoting data.
How much is homeowners insurance in Arizona?
Homeowners insurance in Arizona has no single set cost. When searching for a quote, you’ll notice that several factors influence home insurance prices, including your location and the type of home insurance policy you select. Policies with the same coverage limits can also be quoted differently between insurers.
How your policy choices affect home insurance rates in Arizona
Your policy form
The most common policy forms for home insurance for standard houses are HO-3 and HO-5 forms. These forms provide the most coverage from various perils that may damage the home.
Arizona’s Department of Insurance and Financial Institutions defines a peril as a condition that causes a loss, such as a fire, windstorm, or theft.
A named peril is a peril specifically mentioned as covered in your policy. For instance, a policy in Arizona might list lightning as a named peril, but not a flood, which means damage from a lightning strike is covered but flood damage isn’t.
Policy Quick Look:
Here’s a look at the most common policy options.
HO-1 is a limited coverage policy, covering the home from a limited number of perils. This policy is rarely used in most states.
HO-2 expands upon HO-1 coverage to cover more perils named in the policy.
HO-3 is the most popular policy form. It protects your home from all perils except those specifically excluded in the policy.
HO-5 is another common policy form, with the main difference being that HO-3s use a named perils basis for contents while HO-5s cover both your dwelling and its contents on an open perils basis.
HO-8 is a form designed to cover older homes, reimbursing the homeowner on an actual cash value basis because many of these policies don’t cover full replacement costs.
Depending on the age of your home, its market value, and your area’s risks, one of these policy forms will be better suited for the coverage you need. Before purchasing any homeowners insurance policy, you should always know which perils are covered and which you’ll need a separate policy for.
Your coverage level
Your coverage level will affect your premium costs. While you may be able to lower your premium after you select coverage, the amount and types of coverage that you select will set the initial price.
Keep in mind that the more coverages you select and the more you expect your insurer to pay, the higher your rates will be.
Your deductible is the amount of money you must pay out of pocket when filing an insurance claim. This may be set as a dollar amount or a percentage. For example, you might be asked to pay a $500 deductible per claim or a 2% deductible per claim.
The rate of your deductible influences your total home insurance premium costs. Many policies have a $500 or $1,000 minimum deductible, though minimum deductibles often have the highest premiums. If you choose to raise the deductible, which tells the insurer that you’ll pay more out of pocket when filing a claim, most insurers will lower your premiums to compensate.
See Also: Selecting a Home Insurance Deductible
How location affects home insurance rates in Arizona
With so many factors influencing home insurance rates, it’s understandable that two similar houses, only a few miles apart, might have different monthly premiums. Everything from the region’s weather to the individual ZIP code within a state can influence home insurance quotes.
Today, wildfires are one of the biggest natural disaster risks in Arizona. More than 240,000 properties in Arizona, or 9%, are at risk for wildfire damage, according to the Insurance Information Institute. Arizona ranks fourth in estimated number of properties at risk by state.
People who live close to fire stations or police stations may pay lower rates because their homes are easier to protect. ZIP codes with limited growth or a smaller crime rate may also have lower insurance rates; homes in developing urban areas may have higher rates than homes in rural areas.
Here’s a look at how rates compare in some of Arizona’s largest cities.
|City||Average Monthly Quote|
What are the cheapest home insurance companies in Arizona?
On average, the three cheapest home insurance companies in Arizona are Commonwealth Casualty, Stillwater, and Liberty Mutual. Their average monthly quotes range from $77 to $87, which are all cheaper than the statewide average monthly quote of $117.
Depending on your coverage needs, your quotes may exceed the averages listed. It’s best to identify your coverage needs, then compare quotes from multiple insurers so you can see which is truly the best for you.
|Insurance Company||Average Monthly Quote|
|Homeowners of America||$99|
|Midvale Home & Auto||$123|
How much homeowners insurance do you need in Arizona?
If you take out a mortgage on your home, the lender will usually require you to purchase a home insurance policy. Not only must you meet the minimum requirements set by the lender, but you should also have adequate coverage to cover the cost of replacing or repairing key aspects of your home.
A good rule to follow is to have enough to meet your lender’s requirements, your policy requirements if you’re insuring the property to value, and enough asset protection and liability coverage to weather a disaster or incident.
Before choosing a policy, understand exactly what’s included, what’s excluded, and your coverage’s limits. Homeowners insurance policies have several standard components, though some insurers may provide more or less coverage in certain circumstances.
What home insurance coverages should you buy in Arizona?
If you’re purchasing a standard homeowners insurance policy in Arizona, many insurers will include the following coverages:
Dwelling: Dwelling coverage refers to the physical structure of your home. This coverage typically covers perils, such as fire, hail, and lightning.
Personal property: While dwelling coverage protects the structure of the home, personal property coverage protects your assets. This coverage helps you repair or replace personal belongings that are damaged or stolen.
Other structures: Although the walls and roof of your home are covered under your dwelling coverage, this policy doesn’t include aspects like a shed or fence. Those would be covered in the “other structures” category.
Personal liability: Personal liability protects you from lawsuits resulting from negligence on your property. This includes coverage for injury to people, as well as property damage.
Loss of use: Some damages make it impossible for you to safely live at home while you await repairs. Loss of use coverage reimburses you for expenses resulting from having to stay elsewhere.
What optional home insurance coverages should you buy in Arizona?
Every homeowners insurance policy has exclusions, like war, neglect, and some natural disasters. That’s why you’ll want to consider additional, optional home insurance coverages, such as:
Flood: Flood insurance is rarely included in a traditional policy. Because many Arizona homes are susceptible to flooding, it’s wise to consider this coverage.
Earthquake: Hundreds of earthquakes occur in Arizona each year, though most aren’t strong enough to cause damage. Depending on your area’s seismic history, it might be a good policy to consider.
Water backup: Water backup coverage is different from flooding. This covers damages resulting from water backing up via a drain, sewer, or sump pump.
Scheduled personal property: Although most personal possessions are covered under a traditional policy, certain items aren’t. Additional coverage for “scheduled” items — like antiques, art, or jewelry — provides coverage for these special, more expensive items.
How much home insurance coverage should you have in Arizona?
When deciding how much home insurance coverage you should have in Arizona, there are two general answers: First, however much your lender requires if you have a mortgage. Second, however much you believe can adequately cover your property and belongings after you’ve paid your deductible.
Consider these points when deciding which type and level of coverage to purchase:
The present and future value of your home: When considering if you want a replacement cost or actual cash value policy, keep in mind the age of your home and the future development or population decrease of the surrounding area. All of this will affect your home’s value.
Your home’s weather-related risk: Some homes may be at more risk for certain environmental issues, such as the presence of snow and ice, flooding, or wildfires. All of these should factor into your coverage if applicable.
Optional coverages not included: Along with flood insurance, it’s important to consider adopting optional coverage or increasing your existing coverage for personal items, like jewelry and electronics, which might be damaged or stolen.
Each home has different coverage needs and risk factors. That’s why no single home insurance policy will work for every homeowner. As you explore policies to find the coverage you need, try to gather quotes from at least three different insurers to see which can best meet your coverage and budget needs.
Read More: 10 Best & Worst Sites to Compare Home Insurance Quotes
What are some of the biggest risks when owning a home in Arizona?
Arizona’s diverse geography means that some homeowners can experience severe heat waves while others may see damage from snowfall. While each home’s geographical location increases some of these risks, three perils that are most common throughout the state are:
Wildfires: Humans start 9 out of 10 wildfires in Arizona.
Flash floods: Arizona experiences 40 to 100 floods each year.
Dust storms and monsoons: Monsoon season lasts from June to September; just the Phoenix area alone receives one to three dust storms per year.
Fire damage, as well as damage from wind, precipitation, and debris during a storm, is often covered in a standard homeowners insurance policy. You can also always increase your insurance coverage by purchasing supplemental policies.
Because flooding is rarely covered under any general homeowners insurance policy, it’s especially recommended for homeowners who have properties in a floodplain. Arizona residents can purchase this separate policy through the National Flood Insurance Program.
Learn More: Private Flood Insurance vs. FEMA
How can you save money on homeowners insurance in Arizona?
If you’re looking to reduce your insurance costs, you can employ several strategies.
Bundle home and auto insurance
Many homeowners insurance companies offer other products, such as automotive insurance, recreational vehicle insurance, and watercraft insurance. They may also offer discounts for bundling multiple policies together.
Raise your deductible
You don’t need to accept the lowest deductible amount that your insurer offers. In fact, by raising your deductible, you could lower your premiums. Keep in mind that this is only a wise idea if you can afford the extra out-of-pocket costs when filing a claim.
Review policy limits and value coverage
The value of items and structures depreciates over time, which means that you don’t need as high a coverage limit as they age. For example, your optional insurance coverage for high-priced items like computers could be lowered, or eliminated, once the computer has sufficiently depreciated in value.
Even if you secured the lowest rate for your homeowners insurance policy before, there’s a chance your current insurer is no longer the cheapest option. Coverage rates change, new discounts become available, and simply switching to a new insurer could instantly lower your premiums. That’s why it’s a good idea to continually commit to looking for the best insurance options possible.
Learn More: A Homeowners Guide to Coverage Levels and Limits
What if you have to replace your home in Arizona?
The replacement cost of your home is the cost to replace it using the same materials and construction without deduction for depreciation. This is different from the actual cash value of the home, which is the cost to replace your home minus depreciation from age or use.
The replacement cost of your home should influence the coverage level you choose. For example, if your roof is replaced under a replacement cost policy, you’ll be reimbursed the full cost of the repair, minus the deductible.
However, if you have an actual cash value policy, you’ll only be reimbursed for the current value of the roof repairs minus the deductible and depreciation.
Here’s a list of median home values across large cities in Arizona so you can understand what a replacement cost might look like.
|City||Average Home Value|
Arizona homeowners insurance FAQs
Here are answers to some frequently asked questions about homeowners insurance in Arizona.
How much is home insurance in Arizona per month?
The average monthly cost of home insurance in Arizona is $117. This is for typical homeowners insurance policies and doesn’t include secondary coverages.
Is homeowners insurance expensive in Arizona?
Arizona is one of the cheapest states for homeowners insurance, with an average annual premium of $850. Arizona is tied with Nebraska, and only Idaho, North Dakota, South Dakota, and Wisconsin have lower average premiums.
What does Arizona homeowners insurance cover?
Standard coverages for a homeowners insurance policy in Arizona include dwelling coverage, personal property coverage, personal liability coverage, and other structures coverage.
Flood damage is typically not covered by a standard insurance policy, though floods are a common occurrence in Arizona. Even in parts of Arizona where flooding and flash floods aren’t common, they can still happen, which is why it’s important to consider this additional coverage.
What is a home insurance declaration page?
A home insurance declaration page, also called a “dec page,” summarizes your policy, coverages, deductibles, premiums limits, and the location of the property that you’re insuring.
A new dec page is created each time you renew your policy. You might reference it to find the end date for your current policy, to find contact information for your insurance agent, or to see if there are any endorsements that affect your coverage or premiums.
Does Arizona require homeowners insurance?
No, homeowners insurance isn’t required by law in Arizona or any other state. However, your mortgage company will require it if you’re financing your home.
Even though it’s not required for homeowners who don’t need financing, it’s still a good idea to purchase a plan. Homeowners insurance can protect your home against unexpected perils, like flooding or wildfires. It’s also wise to have because it offers liability protection if someone is injured on your property.
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