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How Much Is Homeowners Insurance for a $400,000 House? A Comprehensive Overview

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  //house-home.news-articles.net/content/2025/12/0 .. or-a-400-000-house-a-comprehensive-overview.html
  Published in House and Home on Monday, December 1st 2025 at 6:50 GMT by CNBC

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How Much Is Homeowners Insurance for a $400,000 House? A Comprehensive Overview

When you purchase a new home, the next step on the financial roadmap is usually figuring out how much you’ll pay for homeowners insurance. A recent piece on CNBC’s “Select” section dives into the specifics of what a homeowner can expect to spend on insurance for a house valued at $400,000. Below is a concise summary of the article’s key points, broken down into the factors that drive cost, the national averages, and practical tips for getting the best coverage.

1. What Determines the Premium?

The article makes it clear that the price tag on a policy is not set in stone; it is the product of several interacting variables:

The article cites a study from the National Association of Insurance Commissioners (NAIC) that shows how these variables interact in different states. For example, a $400,000 home in Florida can cost $1,600–$1,800 per year, while a similar property in Iowa might be closer to $950–$1,100.

2. National Averages

The CNBC piece pulls data from several insurers to arrive at an average cost:

• Average annual premium for a $400,000 home (2023): $1,200–$1,400.
• Per‑$1,000 of coverage: $3.20 – a useful rule of thumb when comparing quotes.
• Per‑square‑foot cost: $1.20 (assuming an average 1,200‑square‑foot home, this again lands near the $1,400 figure).

It also points out that premiums have trended upward in recent years—about a 5% increase annually over the past decade—partly due to higher construction costs and an uptick in catastrophic claims.

3. What’s Included in the Policy?

The article outlines the typical structure of a homeowners policy:

1. Dwelling Coverage – Replaces the structure if damaged or destroyed.
2. Personal Property – Covers furniture, electronics, etc.; usually capped at 70% of the dwelling value unless you add a rider.
3. Liability Protection – Covers injuries or property damage caused by you or your family.
4. Additional Living Expenses (ALE) – Pays for temporary housing if the home is uninhabitable.
5. Optional Riders – Flood, earthquake, jewelry, or high‑value electronics add significant cost but may be essential depending on your area.

The article notes that many homeowners underestimate the importance of the replacement cost value, which is what insurers pay to rebuild, not the current market value.

4. State‑Specific Considerations

A key part of the article is a quick‑look table that shows how costs vary by state. It pulls data from the American Association of State Insurance Officials (AASIO):

• California – Highest due to wildfire risk: $1,700+.
• Texas – Moderate: $1,300–$1,500.
• Colorado – Lower end: $1,000–$1,200.
• Washington – Variable depending on proximity to coastal vs. inland areas.

The article links to separate CNBC pieces that delve deeper into how specific local hazards (e.g., “How Much Is Homeowners Insurance in Florida?”) can sway premiums.

5. Practical Tips for Saving Money

The piece offers actionable advice for homeowners looking to reduce their annual bill:

• Raise your deductible: Even a $1,000 bump can shave 10% off the premium.
• Bundle: Many insurers give discounts if you bundle with auto or life policies.
• Maintain your home: A modern roof, updated wiring, and good drainage can reduce risk.
• Improve safety: Install smoke detectors, fire extinguishers, and security systems; these often qualify for discounts.
• Shop around: Get at least three quotes and compare the coverage, not just the price.
• Consider usage‑based pricing: Some insurers now offer discounts for low driving mileage or safe‑house habits.

The article also suggests using an online homeowners insurance calculator—linked in the original piece—to get a personalized estimate before you contact agents.

6. Bottom Line

For a homeowner eyeing a $400,000 property, the CNBC article paints a realistic picture: you’re likely to pay between $1,200 and $1,800 per year, depending largely on location and risk factors. While these numbers may seem daunting, understanding the variables that shape them—and following the cost‑saving tips—can help keep insurance a manageable part of homeownership.

The article closes with a reminder that homeowners should review their policies annually, especially after major life events or home renovations, to ensure their coverage remains adequate and their premiums stay competitive.

Further Reading (from the CNBC article)

• How Much Is Homeowners Insurance for a $200,000 House? – An article that compares costs across different home values.
• How to Lower Your Homeowners Insurance Premium – A practical guide with discount strategies.
• The 2023 Guide to Homeowners Insurance – A comprehensive review of common coverage types and riders.

These linked resources provide deeper dives into specific scenarios, making it easier for readers to tailor their insurance strategy to their unique circumstances.