One of the not-so-hidden costs of owning a home is homeowners insurance, which provides financial protection in case your house suffers property damage or theft or you’re involved in an event that causes property damage or personal injury. You’re usually required to get homeowners insurance to qualify for and keep a mortgage. Even when the home is paid off, it’s a good idea to insure it — but a surprisingly large number of homeowners are uninsured.
Trending Now: Mortgage Rates Are Dropping — 20 Housing Markets With the Most Affordable Home Prices
Be Aware: 7 Reasons You Must Speak To a Financial Advisor To Boost Your Savings in 2024
One in 13 U.S. homeowners didn’t have insurance for their homes as of 2021, the most recent year for which data is available, according to a March report from the Consumer Federation of America. That represents roughly 6.1 million homeowners, or 7.4% of the total. In financial terms, the total number of uninsured homeowners accounts for at least $1.6 trillion in unprotected market value.
In a press release introducing the report, the CFA warned that without stronger oversight of the insurance industry and significant investment in climate change adaptation, the problem of uninsured homes is likely to get worse in coming years.
“Being uninsured poses a potential threat not only to individual homeowners but also to communities and our national housing stock,” the report noted, adding that the problem can foster “deeper economic precarity for millions of homeowners across the country.”
Here are some key findings from the CFA’s research, which analyzed American Housing Survey data from the U.S. Census Bureau:
-
Homeowners earning less than $50,000 a year are twice as likely to lack insurance compared to homeowners in general. Among lower-income homeowners, 15% are without coverage.
-
Certain demographics of homeowners are disproportionately at risk. Twenty-two percent of Native American homeowners, 14% of Hispanic homeowners and 11% of Black homeowners have no insurance.
-
More than one-third (35%) of owners of manufactured homes and 29% of homeowners who inherited their homes lack coverage.
Cost is a big factor in why some homeowners don’t have insurance. The average home insurance cost in the U.S. is $140 per month for a policy with $350,000 worth of dwelling coverage, according to an analysis from Forbes Advisor. That adds up to nearly $1,700 a year — which can be a significant amount for households on tight budgets.
Though there are differences between the number of uninsured, the problem of uninsured homeowners extends to every state.
1. Mississippi: 13% of homeowners
2. New Mexico: 13%
3. Louisiana: 12%
4. West Virginia: 11%
5. Alaska: 11%
6. North Dakota: 11%
7. Alabama: 11%
8. Oklahoma: 11%
9. Florida: 10%
10. Texas: 10%
Read Next: Kakeibo and the $5.34 Rule — The Japanese Art of Saving Money
11. Arkansas: 10%
12. Kentucky: 9%
13. South Carolina: 9%
14. South Dakota: 9%
15. Montana: 9%
16. Kansas: 9%
17. Michigan: 8%
18. Wyoming: 8%
19. Arizona: 8%
20. Indiana: 8%
21. Nebraska: 8%
22. Tennessee: 7%
23. Iowa: 7%
24. Missouri: 7%
25. Maine: 7%
26. Wisconsin: 7%
27. North Carolina: 7%
28. Georgia: 7%
29. Ohio: 7%
30. Minnesota: 6%
31. Hawaii: 6%
32. Rhode Island: 6%
33. Delaware: 6%
34. Nevada: 6%
35. Idaho: 6%
36. New York: 6%
37. Pennsylvania: 6%
38. Vermont: 6%
39. Illinois: 6%
40. Connecticut: 6%
41. Washington: 6%
42. New Jersey: 5%
43. Virginia: 5%
44. Colorado: 5%
45. California: 5%
46. Massachusetts: 5%
47. New Hampshire: 5%
48. Maryland: 5%
49. District of Columbia: 5%
50. Oregon: 5%
51. Utah: 4%
More From GOBankingRates
This article originally appeared on GOBankingRates.com: Here’s How Many Homeowners Are Uninsured in Each State
