Last Updated on September 29, 2020 by Andrew Lee
As a homeowner in the State of Michigan, you should take the time to learn as much as you can about the ways you can protect and secure it as well as its contents. Your house is your largest – literally and financially speaking – investment, and besides, it’s where you and your loved ones live and spend a lot of time in.
One of the things that you’ll find really helpful in safeguarding your house and other personal property you have in it is a proper Michigan homeowners insurance policy. To help you understand this type of insurance form better, here are some of the lesser-known, yet critical facts about it you should know.
Comparison of national and state homeowners insurance premiums average
It’s also important you learn more about the figures when it comes to the average cost of homeowners insurance nationally and per-state. Doing so will help you set realistic expectations.
According to the National Association of Insurance Commissioners (NAIC), the national average for annually-paid premiums is $1,096.
Comparing this with the State of Michigan’s yearly average of $839 MI places 11th on the rankings of states with the lowest homeowners insurance premiums.
Who’s eligible for this insurance?
According to Michigan’s Department of Insurance and Financial Services, there are laws that define a person as eligible for homeowners insurance. As the organization says, these are the individuals who fall under this description: anyone who owns or rents a house, condominium unit, multiple unit dwelling (shouldn’t consist of more than four residential units), or apartment, and lives in it.
As long as you meet all of these requirements and the law considers you an eligible person, you have the right to homeowners insurance coverage. This is regardless of the neighborhood where your house is located or its age.
The Methodology insurers follow to determine your premiums
Note that the premiums associated with this particular type of insurance can vary greatly, as insurers use many factors to determine how much a policyholder will pay. In general, they follow a method that considers the following:
- Type of coverage you purchase and the amount you’ll get
- The current condition and age of your home (and the other personal belongings you want to insure)
- The specific type and number of claims you have filed in the past
- The overall quality of your home’s structural components
- The most commonly filed-for types of claims in the area your home is located in
- The potential total cost of rebuilding your home after a major or total loss
Knowing these will help you obtain an estimate closest to the potential premiums you’ll pay.