Average Hawaii Home Insurance Lowest in the Nation - Sakamoto Properties

Average Hawaii Home Insurance Lowest in the Nation

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May 11, 2018

Surprised to hear that Hawaii’s home insurance is the lowest in the nation? You’re not alone. It’s a common reaction among prospective Maui real estate buyers. But based on a recent report from GoBankingRates, the average cost of home insurance in the U.S. is $3,798 a year, and Hawaii’s is nowhere near that. So if you’re deliberating between your favorite states in terms of a real estate investment, you may be interested in the following information.

Hawaii’s average annual insurance cost was $703, according to the report. Contrast that with Florida, which had the highest rate at $6,892. So why are both of the nation’s lowest latitude states on each end of the cost spectrum? Although they enjoy similar warm temperatures, Florida’s high frequency of fires, hurricanes and tropical storms all contribute to its sky high rates. Meanwhile, Hawaii is rarely scraped by hurricanes, and although we’ve had unusually high rainfall lately, property damage still doesn’t compare to Florida.

Sloping island topography makes for relatively fewer flood-prone areas as well. Hawaii homes themselves also tend to be well adapted for wind and rain. You won’t find basements in Hawaii, but you will find many homes that are on low stilts that allow rain water to simply pass through. To preserve views, the state is also strict about building heights, which happens to contribute to stable floor plans that spread out instead of up. It seems that when you combine Hawaii’s low incidence of disasters with its high frequency of well-designed homes, you enjoy the lowest average insurance rates in the nation.

As for many of the other high-cost states in the nation, cold winters with ice and heavy snowfall were big contributors, causing damage via freezing pipes and flooding. Hawaii’s subtropical climate keeps things balmy and warm, even in the winter months. With thousands of miles of ocean in every direction, temperatures also tend to be much more consistent than inland locations.

According to FEMA, Texas has had the most natural disasters in recent history, and its average annual insurance cost is $3,306, with the higher rates found south of the Gulf Coast. FEMA placed California as the state with the second-highest natural disaster rates, with fires ranking highest among insurance claims. The earthquakes also contribute. Despite this, California’s average annual insurance cost was $1,619. Not bad, but still more than twice what the average Hawaii homeowner pays. If you’d like to learn more, you can visit www.gobankingrates.com.

If you’re undecided as to which island to choose for your Hawaii real estate investment, you may be interested to know that Maui tends to be less prone to natural disasters than its neighboring islands, in terms of both frequency and severity. If you’d like to buy a West Maui property in a great location, we’ll be happy to assist you in finding just the right property for your needs. Feel free to reach out to our real estate agents at Sakamoto Properties if you need us. We look forward to hearing from you! Mahalo!

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