Homeowners Insurance in Massachusetts

The state of Massachusetts is steeped in rich history enjoyed by residents and visitors. Massachusetts is in the Northeast, prone to hurricanes, winter storms, and floods. Hurricanes and winter storms can both cause devastating property damage, resulting in costly claims and losses for insurance providers. Since 1953, Massachusetts has had 47 federally declared disasters, and the rate of disasters per 1 million people is 6.7.

Along with claims for hail damage, heavy winter snow, ice, and windstorm damage, Massachusetts residents also file claims for water damage from burst pipes, flooding, ice dams, slips and fall accidents, trees falling on the house, dog bites, and fire.

Massachusetts does not legally require homeowners to have insurance, but the state strongly encourages you to do so. However, if you obtain a mortgage to buy a home in Massachusetts, the lender will require you to have homeowners insurance to protect their interests. They will also dictate specific coverage limits, which you must keep in place until you pay off the loan.

As of October 2024, the average homeowners insurance rate in the U.S. is $2,728 a year or $227 monthly. Massachusetts property owners pay an average of $1,525 annually, significantly lower than the national average.

Depending on the state and possible perils, different carriers may offer different coverage options. Although homeowners insurance in Massachusetts can vary by provider, typically, you can choose from six types of home insurance. They are as follows:

Massachusetts has miles of coastline, which means floods. Experts strongly recommend that homeowners also add coverage for floods, which is extra and only offered by some insurance companies. You should also consider an umbrella policy to fill in any gaps in coverage.

FEMA (Federal Emergency Management Agency) manages the National Flood Insurance Program (NFIP) through a network of 50 providers across the U.S.

Since most homeowners insurance does not cover floods, this supplemental coverage can repair damage and replace items after a flood. It can cover the building and/or your personal belongings, depending on your options. This program is available to homeowners, renters, and businesses. Learn more about the program on FEMA's website.

The entire country is experiencing more frequent natural disasters and storms due to climate change. Global warming is affecting our weather and the home insurance industry. Severe weather is the number one thing affecting homeowners insurance rates today. Over the past five years, rates have spiked an average of 34% and as high as 60% in some high-risk areas. In Massachusetts, home insurance rates have increased by 22.8%, which is considerably lower than the national average.

Heavy winter storms and hurricanes are Massachusetts's most common and damaging natural weather events. Many windstorms cause hail, which is also very destructive. One hail and wind damage claim costs insurers an average of $11,650. A single claim for fire costs an average of $77,340, and the average cost of a water and freezing claim is $11,650. From 2015 to 2019, Massachusetts insurance providers lost a total of $1,128,428,200 in claims. Massachusetts is on the list of states with the most homes at risk of hurricane damage. From 1980 to 2024, Massachusetts had 44 billion-dollar disasters.

Property owners need to find ways to save money as the cost of everything rises, including home insurance. One way to do that is to learn the factors that impact insurance and make adjustments.

Some ways to save on homeowners insurance in Massachusetts include:

• Avoid Risks: Don't add new risks to your home and eliminate existing ones.
• Raise Your Deductible: Raise your deductible as high as possible to lower your premiums.
• Adjust Your Coverage: Review your coverage each year and lower your coverage limits if you need to save money on your rates.
• Improve Your Credit: Work on improving your credit and then ask your insurer to adjust your rates accordingly.
• Make Your Home Safer: Install home security to make your home safer and save on home insurance.
• Bundle Policies: Bundle all your policies together with the same provider to get lower rates.
• Ask for Discounts: Ask your insurance company for any applicable discounts.
• Don't File Small Claims: Don't file any small claims; wait until you really need it before using your insurance.
• Home Improvements: Improve your roof, windows, and siding to make your home more weather-resistant and get lower rates.

No one likes having to pay for insurance, but homeowners insurance in Massachusetts is essential for protecting your home and your assets in the event of a catastrophic event. If your home is damaged or destroyed by fire, water, natural disasters, or even burglary, your homeowner's insurance will pay for repairs or replacement. Most policies also include other structures: coverage, liability, medical payments, loss of use, and personal property coverage.

You can obtain a policy quickly by calling the insurance carrier's 800 number, contacting them online, or finding a local agent to work with you. You must pay the first year in advance and then pay monthly through your mortgage escrow. If the provider wants to cancel or not renew your policy, by law, they must inform you 45 days before the policy expiration. Before a policy is active for 60 days, the insurer can cancel it anytime. After those 60 days, according to Massachusetts law, the policy can only be canceled for the following reasons:

• Nonpayment of premiums.
• Conviction of a crime, which means adding to the risk.
• The insured commits fraud or misrepresents themselves when obtaining the policy.
• Willful or reckless acts of omission which increase the hazard of damage.
• Physical alterations of the property that make it uninsurable.
• The insurance commissioner determines that the policy violates the law or would place the insurer in violation of the law.

Some of the most common discounts offered by homeowners insurance companies include:

• Senior Discount: Retirees and senior citizens often pay less for home insurance due to discounts related to age.
• Military Discount: Many firms offer home insurance discounts to military personnel (active and retired).
• Job-Related Discount: Government workers, firefighters, and teachers get discounts for their occupations.
• Non-smoker Discount: Non-smokers earn a discount for having a lower fire risk.
• Loyalty Discount: If you stay with the same company for many years, they may offer you a discount year after year.
• Autopay Discount: Sign up for autopayments, and your insurance provider may offer a discount.
• Paperless Discount: Opt in for paperless billing, and your insurer may discount you.
• Multi-policy Discount: Bundle all your insurance with the same provider, and they may offer you a discount on your rates.
• Home Safety Discount: Improve your home safety with sprinklers, smoke alarms, and fire extinguishers to qualify for a discount on your home insurance.
• Security Discount: Install a home security system to keep your home safer and earn a discount.
• New Home Discount: New homes cost far less to insure than older homes.
• Green Discount: Install green appliances throughout your home and help the environment while earning a discount.
• Claims-Free Discount: Stay claims-free for as long as possible to earn home insurance discounts.

Common Rates Offer by Homeowners Insurance Firms

New construction homes cost a lot less to insure than older homes. They are constructed of fire-retardant materials and code-compliant processes, making them easier to rebuild after a disaster. With a new home, you can save up to 40% less on your home insurance. A home five years or younger can cost up to 26% less. In Massachusetts, the cost of home insurance on a new construction home averages $1,275. Your actual premium will vary depending on the firm you choose, your age, credit score, claims history, and other factors.

Top 10 Home Insurance Firms in Massachusetts and Average New Home Savings

Home renovations can turn your shack into a palace overnight and considerably impact your home insurance rates. Some updates add space and value but also risk and increase your rates. Others reduce risk, making your home safer and decreasing your rates. Some upgrades don't affect your rates at all.

Home Renovations that Increase Rates

Some home renovations that increase your rates include:

• Building an Addition: Adding space to your home is nice but could mean more expensive home insurance. More space will cost more to replace.
• Solar Panels: Solar panels are a great way to save thousands on electricity, but they could increase your insurance because they are pricey. Replacing them could be costly.
• Adding a Fireplace: Adding a fireplace enhances the beauty and warmth of your home but also raises your risk of fire and your insurance rates.

Home Renovations that Decrease Rates

Some home renovations that decrease your rates include:

• Update Your Plumbing: Outdated plumbing could cause water damage and flooding, ruining your home. By replacing it, you could save big on your insurance rates.
• Storm Safe Windows: Storm-safe windows will reinforce your home against storms and make your insurer happy. As a result, they will lower your rates.
• Sump Pump: A sump pump is a great way to prevent your basement from flooding, and your insurance provider will reward you with lower rates.

Your home insurance does not cover regular maintenance or elective upgrades. Homeowners insurance pays only to repair or replace your home after a qualifying event, like a fire. Every policy has limits, and anything beyond those limits will not be covered. Pest infestations, rodents, and animal damage are also not covered.

Always discuss any renovations with your insurance agent before starting work. They can help you understand how the project will affect your rates and coverage and if any changes are necessary. If you make substantial improvements to your home, such as a renovated kitchen or bathroom, update your coverage, or it may not cover replacing the new materials and fixtures.

People renting homes rather than buying them also need insurance to protect themselves. Renters insurance, however, does not include dwelling coverage. TheMassachusettsproperty owner must cover that themselves. The primary purpose of renters insurance is to protect your personal property and replace your belongings if they are destroyed in a covered peril like a fire. Renters insurance also includes liability coverage, medical payments, and loss of use. Policies have strict limits, and expensive items like furs, jewelry, and fine art will not be covered.

Some covered perils include:

Some of the items that renters insurance covers are:

Renters insurance is priced according to three main factors, and they are:

Renters in Massachusetts pay an average of between $15 and $30 a month, which is in line with the national average of $15-$20 a month. City people will pay more (due to crime) than those living in the suburbs.

Condo dwellers also need homeowners insurance. However, condo insurance, or HO-6, slightly differs from regular home insurance. The dwelling coverage covers only the interior. Condo associations have their own master policy, which pays to rebuild the building after a disaster and restore it to its original condition (when it was first built). That means any flooring upgrades, appliances, baths, and kitchens will not be replaced. That is where condo insurance comes in and restores the interior fixtures to their most recent condition. Condo insurance also includes personal property coverage, liability, medical payments, loss of use, and loss assessment.

Condo insurance differs from renters in that it has some dwelling coverage but is limited to the interior only. The other difference is that with condo insurance, if a person gets hurt, the liability insurance will only pay if they are injured inside the condo, not outside or on common grounds.

After a qualifying event, condo insurance pays to replace the following items:

• Appliances
• Flooring
• Interior Walls
• Wiring
• Plumbing
• Light Fixtures
• Cabinets
• Countertops
• Personal Belongings

Massachusetts condo owners pay an average of $520 a year or $43 a month for $60,000 of personal property coverage, $300,000 of liability, and a $1,000 deductible. The national average is $625/year.

Some ways to save on condo insurance premiums include:

• Shop Around and Compare Prices
• Bundle Your Home and Auto Together
• Increase Your Deductible
• Look for Other Discounts
• Upgrade Your Home with a Security System
• Keep Your Credit Score High
• Avoid Small Claims

Homeowners insurance policies are essential, as evidenced by the stark increase in purchases from 2020 to 2021. Despite no laws requiring homeowners insurance, insurers issued almost $100,000 in additional policies during that period. There are 90 licensed homeowner insurance providers in the Commonwealth of Massachusetts, making the industry very competitive, which is good for consumers. Over the past ten years, insurance providers have remained profitable, and losses have been less than in other states.

Winter storms and hurricanes are Massachusetts' most significant source of home insurance claims. As these storms ramp up and become even fiercer and more frequent, some providers may incur losses and decide to pull out of the state, limiting coverage for residents.

The federal government does not regulate the home insurance industry. Instead, each state decides upon a department to oversee the industry, monitor providers and rates, investigate consumer complaints, and punish guilty firms. In Massachusetts, that agency is the Division of Insurance, located at South Station, 5th Floor, Boston, MA 02110.