Do I Need High-Risk Homeowners Insurance?

What Is High-Risk Homeowners Insurance?

High-risk homeowners insurance is an insurance policy for those with high-risk situations. These policies may limit coverage or come with larger premiums to account for a higher likelihood of insurance claims.

Several factors can increase a homeowner's likelihood of filing claims. These include the home's location, the prevalence of natural disasters, the homeowner's credit score and claims history, and the presence of attractive nuisances on the property. If you're struggling to get coverage, you may have to take out a high-risk insurance policy or look to state-managed insurance plans.

Who May Need High-Risk Homeowners Insurance?

There are several factors that may qualify you or your home as high risk. Some of the more common factors are detailed below.

Homeowners in High-Risk Areas

Natural disasters, such as floods, wildfires and hurricanes, are a major factor affecting the insurance landscape. For example, nearly 2 million homeowners have been dropped by their insurers since 2018, according to a 2024 report published by the U.S. Senate, in large part due to more frequent natural disasters.

The higher the home's risk of natural disasters and other damage, such as crime, the more likely it'll require high-risk homeowners insurance.

Homeowners With a History of Frequent Insurance Claims

Those with a history of frequent homeowners insurance claims appear riskier to insurers and may face higher premiums. That's because if you've made frequent claims in the past, it's more likely you'll make claims in the future.

Homeowners With Poor Credit History

Some states assess homeowners' credit histories during the insurance underwriting process, as they consider there to be a link between lower credit history and more frequent claims. However, certain states, including California, Hawaii, Maryland, Massachusetts, Michigan, Oregon and Utah, restrict the use of credit in setting insurance rates.

Owners of Vacation Homes

Second homes that sit vacant or unoccupied for periods of time present more risk to insurers. If, for example, a roof leak starts in an empty vacation home, it's more likely to cause extensive damage before someone notices and gets it repaired.

Homeowners with Dogs

Dogs present an additional risk to insurers, as pets are generally covered under liability limits of a homeowners insurance policy. However, insurance companies may deny coverage for certain breeds that have a higher perceived risk of biting. Coverage varies by insurance company, but common breeds that insurers consider high risk include:

• Doberman Pinscher
• Pit bull
• Rottweiler
• Chow chow
• Wolf-dog hybrids
• German Shepherd

Homeowners with Attractive Nuisances

Attractive nuisances are property features that are tempting but dangerous to children—think pools, trampolines or treehouses. The inherent risk of these features on your property can lead to higher premiums.

High-Risk Homeowners Insurance Companies

If you or your property are considered high risk, you may have trouble finding a homeowners insurance company to work with. If so, you may start with the following insurers, which offer high-risk homeowners insurance policies, discounts to offset premiums and additional coverage options.

Allstate

Allstate offers a range of discounts that can offset high premiums associated with a high-risk home. For instance, you can save money by setting up autopay, using theft or fire protection devices or installing wind mitigation features on your home. Additionally, Allstate offers flood insurance options for those in flood-prone areas.

Nationwide

Nationwide policyholders can add optional coverages that protect them from certain location-specific risks, such as earthquakes and floods. Additionally, Nationwide offers policies for second homes and vacation homes, which have unique risks.

To offset higher premiums associated with high-risk homes, you can see if you qualify for any of Nationwide's discounts. Some examples include discounts for living in a gated community, installing protective devices in your home and staying claims-free.

Progressive

Progressive offers several ways for high-risk homeowners to lower their insurance premiums. Examples include wind mitigation discounts and safety and alarm discounts.

Though Progressive doesn't cover risks like floods, earthquakes and other natural disasters, it does offer unoccupied home insurance for second homes.

State Farm

Unlike other insurance companies, State Farm doesn't ask about dog breed when underwriting insurance policies, so having a traditionally "risky" breed won't affect your premiums.

When it comes to location-specific risks, State Farm offers discounts for wind and fire mitigation in certain areas.

Kin

Kin is a relatively new company serving homeowners in the South and Western U.S. Its homeowners insurance policies cover a wide range of traditionally high-risk disasters. For example, you can customize your Kin homeowners insurance policy to cover damage from hurricanes, wildfires, wind, earthquakes, sinkholes, vandalism and more.

State-Managed Insurance

If you can't get coverage from a private insurer, consider a Fair Access to Insurance Requirements (FAIR) plan. These state-managed plans are available to those who have been denied by private insurers because of certain risk factors. You may have to offer proof of denial from multiple companies in order to get coverage.

FAIR plans aren't available in every state. In some cases, coverage is limited, and you may need to buy supplemental coverage to fully protect your home. Like high-risk homeowners insurance from private insurers, FAIR plan policies can be more expensive to account for potential risk factors.

How to Lower Your Homeowners Insurance Risk

While you can't eliminate factors like natural disasters, crime or prior claims, there are ways to lower your homeowners insurance risk. Here are some tips that may help lower both your risk and your premiums:

• Improve your credit. If you live in a state where credit-based insurance scores are used in the underwriting process, improving your credit could yield results. While credit-based insurance scores are not the same as the ones lenders use, they are calculated using many of the same factors. Focus on improving your credit by making on-time payments, paying down revolving balances and limiting new credit applications.
• Upgrade your home security. Tightening up your home security by installing cameras, alarms and gates can give you peace of mind—and potentially lower your premiums. Look for providers that offer home security discounts, such as Progressive, Nationwide or Allstate.
• Keep up with home maintenance. A well-functioning home is less likely to have issues leading to claims, so don't skimp on regular home maintenance.
• Manage attractive nuisances. Keep kids safe from potentially dangerous situations by installing a fence around your pool or removing your trampoline or treehouse.
• Reduce the risk of pet-related claims. Take measures to limit the likelihood of dog bites and injuries. Socialize your dog with other pets and people, keep them fenced or leashed, and don't leave them alone with guests.

The Bottom Line

Owning a dog, having a lengthy claims history or living in a disaster-prone area may make your homeowners insurance more expensive, but it doesn't mean you won't be able to get coverage.

Look for companies that offer high-risk homeowners insurance policies, and lower your risk by upgrading your home security, improving your credit, and maintaining your home and property. If private insurers deny you coverage, look into state-managed FAIR Plans.

If you're wondering how your credit may be impacting your insurance premiums, check your FICO^® Score^Θ for free with Experian. Once you know your credit score and the factors impacting it, you can take steps to improve your credit.