Everything You Need to Know about Home Insurance in Colorado

From the snow-covered Rockies to the sandy deserts, Colorado has something for every outdoor enthusiast. Home to many different Native American tribes, the Mile High State became part of the U.S. in bits and pieces throughout much of the 1800s. In 1861, Colorado was organized into the free Territory of Colorado and the borders remain largely unchanged today. In 1876, Colorado was admitted to the Union as the 38th state and earned the nickname Centennial State.

With so many different things to do and see in Colorado, you’ll need to take in all the sites over a period of time. Of course, the mountain slopes call out to hikers, skiers and others who enjoy experiencing the wild outdoors. Can you really say you’ve experienced an outdoor concert if you haven’t been to Red Rocks Amphitheater? For those that like things a little spooky, check out the many ghost towns, such as St. Elmo – relics from the state’s glory days as a mining center.

Wherever you set up home in Colorado, there’s plenty for you and your family and friends to do on the weekends. You’ll need home insurance for your Denver domicile or your Castle Rock ranch to ensure you and your home base are protected. At InsureOne, we will expertly find you the best insurance for your situation – with flexible solutions and affordable prices.

How Much Does Homeowners Insurance Cost in Colorado?

The average cost of a home insurance policy for a $300,000 home is roughly $2,300 annually. This is substantially more than the national average of approximately $1,800. Colorado rates are high due to an increasing chance of wildfire, annual hail damage claims and the inflation and supply chain issues surrounding all markets in the U.S.

In recent years, wildfires and rising costs and shortages of lumber have caused Coloradoans to experience higher rates. Construction costs have continued to rise over the last few years due to ongoing supply chain issues and labor shortages.

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How Do Home Insurance Deductibles Affect Rates in Colorado?

You can minimize your monthly (or bi-annual) insurance cost by increasing your deductible and vice versa. Your deductible is the amount you will pay if you submit a claim to your insurance company. If you can raise your deductible to $1,000 or more, your insurance company will be paying less in the event of a claim.

If your deductible is $2,000 and your claim is worth $7,000, you will pay $2,000 and your insurer will pay $5,000. This is one way to lower your premium.

Compare Home Insurance Rates by Coverage Levels in Colorado

The cost of your premium relies on many factors, such as age and location. However, the amount of dwelling coverage your policy includes is one of the most important. This is how much your insurer agrees to pay if your home needs to be rebuilt. There are many reasons why you should be completely realistic about this number, but mainly because if you lose your home, you’ll want to have the funds to rebuild or purchase another one.

Here are some average annual costs for residents of Colorado based on the value of their home.

Dwelling Coverage (Colorado) Average Annual Insurance Cost
$100,000 $1,100
$200,000 $1,100
$300,000 $2,300
$400,000 $2,300
$500,000 $3,300

At InsureOne, we can help you find the best home protection at the best price. We’ll shop around for you and provide you with the top options so you can choose.

Is Home Insurance Tax Deductible in Colorado?

In most cases, you cannot deduct your home insurance from your taxes. There are some exceptions that you may try, including expenses for a home office if you work from home and requesting an amount if you were denied a claim during the year.

Does Colorado Have the 80% Homeowners Insurance Rule?

Almost all insurance companies use the 80% rule, but many homeowners are confused by the whole concept. Simply put, if you don’t have enough coverage to pay for at least 80% of your home’s replacement value cost, your insurance company will not payout the full amount of your policy in the event of a claim.

For example, a home with a replacement cost of $500,000 should be covered for at least $400,000 (80% of $500,000). If the home is insured for less than that, the insurer will only pay out a portion of the minimum

coverage purchased. Remember, if you make capital improvements to your home, you’ll need to increase your coverage amount to 80% or higher of the replacement cost.

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Bundling Home and Auto Insurance in Colorado

Bundling two or more insurance policies into one with the same company can save you some serious money on your policy. Insurers appreciate your loyalty and it’s easier to administer a combined policy. You can bundle your home insurance and auto insurance (or any other policy) together for up to 25% off your policy.

Be sure and ask your InsureOne agent what discounts you may qualify for when you contact them to purchase or renew your policy.

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What Factors do Insurance Companies Consider when Setting Rates in Colorado?

As mentioned, there are many factors that go into your total premium cost. With home insurance, insurers look at how much it will cost to rebuild, how close your home is to a fire hydrant and a fire station, and what type of roof is on the home.

Here are a few more items to consider:

  • Age: Older homes with electrical and plumbing systems that may not meet today’s codes will cost more to repair and rebuild. Older homes may also contain materials that are harder to find or more expensive today.
  • Building Materials: What the home is mainly composed of will come into play. For example, a homemade of mostly brick is considered less likely to burn than a home composed mostly of wood.
  • Location: Lately, natural disasters and wildfires have grown in scope and damage. Some parts of Colorado have an increased risk of wildfires. Hail, ice and melting runoff may also be a consideration in this part of the country.

Your credit history and your claims history may also have a bearing. That’s why it is a good idea to seriously consider repairing a small issue out of pocket rather than file a claim, if you can.

What are the Different Types of Home Insurance?

There are 8 different types of homeowners insurance policies and they all provide coverage for that special place you call home – whether it’s an A-frame in Arvada or a condo in Colorado Springs.

Most people buy an HO-3 policy, the most common homeowners coverage in Colorado. However, you may find that you need a more comprehensive policy or something different altogether. Home policies are customizable, so you can add riders for different things, such as expensive art or jewelry.

Purchasing the correct type of home insurance is vital. Let an InsureOne professional guide you through the process.

What is the Most Common Homeowners Insurance in Colorado?

It depends on where you live in the Centennial State. Colorado changes drastically from the warm south to the Colorado Rockies. You may live in congested Denver or scenic Steamboat Springs. If you are even further north, you’ll be surrounded by forests and canyons.

Home insurance is not a one-size-fits-all proposition. Each homeowner has specific needs, so find an agent that is flexible and happy to get the best policy for your unique situation.

Get the Best Homeowners Insurance in Colorado Today

At InsureOne, we’ll listen to your needs and budget and research options for you so you can spend time doing things you love, like spending time with your family. At our one-stop shop, we’ll provide you competitive options tailored specifically to you. Reach out to us today by phone at (800) 836-2240 or find a quick home insurance quote online. You are also welcome to stop by one of our convenient Colorado locations.