Finding affordable insurance can be tricky anywhere you live, but Mississippians face a tougher battle than most Americans; for example, it’s impossible to find private insurance south of Interstate 10. The flood and storm risk is just too great, so private companies toss homeowners into the state-run insurance pool. Insurance companies have a reason for backing out of that area of the state. Their net returns on homeowners insurance have been -26.8% over the past 10 years and -9.6% over the past 25.

Still, no matter where you live in the The Magnolia State, insurance providers should be held to a universal standard; companies must have transparent coverage, friendly agents, sound financial standing, and reasonable cost. We spent numerous hours researching the insurance laws and regulations to provide you with a comprehensive understanding of what to expect.

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The Best Homeowners Insurance in Mississippi

Freshome’s Recommended Homeowners Insurance Companies in Mississippi: State FarmAllstateLiberty MutualShelter, Travelers Insurance

The top companies we recommend are AllState, State Farm, and Liberty Mutual. We’ve gotten quotes from each of the companies (the breakdown of their coverages can be found below.) In addition, we examined alternative companies that offered regional or otherwise that could provide better rates for local homeowners. Every company examined faced strict criteria:

  • An Overall Satisfaction Rating from J.D. Power of three stars or more
  • Satisfactorily high financial strength rating from Moody’s and/or Standard & Poor’s
  • A rating of B+ or higher from A.M. Best

As you search for quotes, keep in the mind that they’re highly personalized. In the sample quotes given, I used the bare minimum of information to obtain the most neutral quote possible. Our fictitious homeowner is a 26-year-old nonsmoking male with no prior claims looking for insurance on his first home. He is employed and has completed the undergraduate level of college. Rather than taking the quotes you find here as gospel, use them to get an idea of what each company offers and then find out what your quotes look like.

The home used for the example is a small, one-story, 1,200-square-foot home found in Greenwood, Mississippi. It has two full bedrooms, one full bathroom, and one three-quarter bathroom. Its selling price is $25,000, and we sought quotes for $100,000 in coverage.

Example Quotes

The quotes below were given for a 1,200-square-foot, two-bedroom, one-and-three-quarter-bath home found in Greenwood, Mississippi. The insured is a 26-year-old nonsmoking male with no pets, no prior claims, gainful employment, and a college education.

State Farm provided a quote of $126 monthly with an annual premium of $1,517. This included a $2,000 deductible, $100,000 in dwelling coverage, and $75,000 for the other structures on the property, which in this case is a 200-square-foot detached garage.

Our Quotes
Allstate$1,377 Per Year
State Farm$1,517 Per Year
Liberty Mutual$2,394 Per Year

Liberty Mutual provided a quote of $199 monthly and an annual premium of $2,394 per year, nearly $900 more per year than State Farm. This included a $1,000 deductible, $100,000 in dwelling coverage, $10,000 for other structures on the property, and $50,000 for the contents of the home.

Allstate provided a quote for $116 per month or $1,377 annually. It included $117,833 in dwelling coverage, $11,783 in coverage for other structures on the property, and a $2,000 deductible.

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Types of Home Insurance Policies in Mississippi

The types of home insurance policies most commonly offered in Mississippi are:

  • HO3 (special form)
  • HO4 (renters insurance)
  • HO5 (comprehensive insurance)
  • HO6 (condominium and townhouse insurance)
  • HO8 (modified coverage)

The type of insurance most homeowners seek out is an HO3 policy, which is considered an “open perils” policy. It’s the most common type of home insurance, as well as the most flexible. There are a few key elements to keep in mind when working with an open perils policy compared to a named perils policy.

Open perils policies protect the homeowner against all direct threats of loss except those explicitly excluded from the policy. Open perils policies may differ from provider to provider, so take care to ensure any threats in your area are covered. In many cases, flood damage is not covered under an open perils policy.

Named perils policies provide broad-form coverage (coverage that extends beyond the basics and includes rare occurrences) to protect the insured against a variety of threats specifically named in the policy. The most common types of loss covered in these policies include those listed below, but may cover other types of damage as well. Reading the wording of your individual policy carefully.

  • Fire and lightning
  • Windstorms and hail
  • Explosions
  • Riots and civil commotion
  • Aircrafts
  • Vehicles
  • Smoke
  • Vandalism
  • Theft

A final aspect to keep in mind when working with HO3 policies is that they provide six coverage in six different areas.

Coverage A is dwelling coverage. This protects the home itself and any attached structures.

Coverage B protects other structures on the property, such as detached garages, fences, storage buildings, etc.

Coverage C covers the contents of the home and the personal property of the insured. However, this coverage amount is typically capped at near 80 percent of coverage A. If you own items of particular wealth, such as furs, rare paintings, and precious jewels, you have several options. The first is to obtain an endorsement for more coverage in this area, or you can take out a separate policy to cover that item in particular.

Coverage D protects the insured against the loss of use of their home, such as in the event that a full rebuild is required. The amount varies and is usually quote as the actual loss amount.

Coverage E is personal liability protection, helping to cover the insured’s personal assets against litigation.

Coverage F is medical coverage. For instance, if someone harms him or herself on your property, coverage F helps to cover his or her medical costs.

What You Should Know Before Getting a Quote

If the prices above shocked you, there’s good news: your premiums could be much lower. However, you should not aim low when it comes to dwelling protection. Your homeowners insurance should provide you with enough coverage to cover the cost of a total rebuild of your home including labor costs. In addition, you should consider inflation; as home values rise throughout your lifetime, you should ensure your coverage remains enough. If you aren’t sure how much coverage you would need, hire an appraiser to examine your home and give you an estimate.

The average cost of home insurance in Mississippi is $121 monthly, or $1,451 annually. This is 44 percent higher than the national average. Keep in mind that if you live in a coastal area of Mississippi, it will be nearly impossible to find private insurance. However, there is an alternative: the Mississippi FAIR Plan.

The FAIR Plan

The Fair Access to Insurance Requirements Plan was put into effect in the 1960s to ensure residents had access to insurance in areas with abnormally high risks outside the resident’s control. This includes the coastal areas of Mississippi, which are prone to violent hurricanes and flooding. However, unlike many states, Mississippi actually has two FAIR plans: The Mississippi Windstorm Underwriting Association and the Mississippi Residential Property Insurance Association.

To qualify for the FAIR Plan, residents must take steps to reduce the risk of fire, water, and theft. This can include upgrading the electrical system to make it less prone to shorts, installing a security system, and overhauling your plumbing. Failure to correct conditions that put your home at risk can result in the denial of coverage.

If you are unable to get private coverage, you can contact the Mississippi FAIR Plan Board at (601) 981-2915.

Flood Insurance Policies

The Mississippi River is the largest river in North America, and also the most prone to flooding. Anyone living in the coastal regions or along the river basin should carefully consider an additional flood insurance policy, as most policies do not include flood coverage. Even if you do not live near water, flood coverage should be a consideration. Not only can the water itself cause damage, but the dampness and mold that it leaves behind can cause as much damage, if not more, than the water itself. Those living in floodplains are legally obligated to have flood insurance.

“Some people don’t want to look at a house that’s going to be in a floodplain, but if they do fall in love with one, they have to have flood insurance.”- Cynthia Carter, Realtor at Charlotte Smith Real Estate

Preparing for a Quote

Before you begin searching for quotes, take the time to compile relevant information about yourself, such as:

  • Your employer and your membership in any special organizations (many companies offer discounts for members of certain groups)
  • The age of your home and the year it was built
  • Any recent renovations your home may have gone through, including electrical upgrades, plumbing, and landscaping
  • Your proximity to fire and police services
  • Your home’s security system
  • Any prior claims you may have made on homeowners insurance (companies will request details about the particular claim and its cause as a safeguard against potential insurance fraud)
  • The type of roof on your home and its age
  • If your home has any particular safeguards against extreme weather, such as storm shutters

Keep in mind that certain companies will make an inquiry into your credit. While this will not affect your credit score, the inquiries show up on your report and can raise eyebrows if too many occur within a short span of time.

Why Are Mississippi’s Rates So High?

The average premium in Mississippi is 44 perecent higher than the national average. However, due to the state’s propensity for hurricanes (hit by major storms nearly every three years), private companies classify it as a high-risk area.

FAQs

What can I do to lower my premiums?

If you live in an area with private insurance coverage, there are several things you can do to lower your costs. The first is to shop around; before deciding on a company, compare quotes. Look at the companies mentioned in this article to get an idea of which may offer the lowest rates.

Raise your deductible. Another option is to increase your deductible. This can lower the premium amount, but it will result in you paying an initially higher out-of-pocket expense for any damage that occurs.

Lower Coverage B and C. If you reduce the amount of coverage areas B and C your policy provides, your overall costs will drop. However, take care that you do not under-insure yourself; many people underestimate the value of their personal belongings.

Bundle your policies. If you purchase both homeowners insurance and auto insurance from the same company, you can often save as much as 30 percent on both premiums.

Upgrade your home. Increasing your home’s ability to weather severe conditions (storm shutters, hurricane windows, etc.) and its security (burglary and fire alarms monitored by local police, CO2 detectors, etc.) can reduce your premiums.

Stop smoking. Because cigarettes are a major cause for home fires, many companies offer reduced rates to non smokers.

What are common coverage gaps?

Sump pumps. The average insurance policy does not cover sump pump failure or the subsequent damage it causes. In areas where flooding is common, sump pumps are vital for clearing excess water from the home.

Frozen pipes. While many policies offer protection from water damage, they do not cover frozen pipes as the cause. In areas where the winter can be very cold, frozen pipes are always a risk. Make sure your policy covers this source of loss.

Earthquake damage. While many don’t see the point in earthquake coverage, particularly in the United States, Mississippi falls within what is known as the New Madrid Seismic Zone. In 2009, experts theorized that if the zone had an earthquake, it would cause severe damage to multiple states including Mississippi.

What about flood insurance?

The majority of homeowners insurance policies do not include flood coverage. However, where rates were once unaffordable because of the threat in Mississippi, the Homeowner Flood Insurance Affordability Act makes it easier to find flood insurance that won’t break your budget.

Should home insurance play a role in my home buying decisions?

Newer homes are more likely to have more modern electrical systems, which can reduce premiums by 8–15 percent in certain areas. While it shouldn’t be the primary factor, home insurance should be one of your considerations when buying a home.

How often should I review my policy?

You should compare your coverage against your policy once per year to guarantee your possessions and home value are still sufficiently covered. You should also compare after performing any major upgrades or renovations that add significant value to you home.

Take Action

Mississippi is a high-risk area for homeowners. Its proximity to the Gulf of Mexico and the turbulent hurricanes that pass through the area make home insurance more important than ever. Don’t wait until disaster strikes to make sure you have enough coverage; begin shopping around today. Compare quotes and find out what company can give you enough coverage for a full rebuild of your home. As the old adage goes, prepare for the worst and hope for the best.

Freshome’s Recommended Homeowners Insurance Companies in Mississippi: State FarmAllstateLiberty MutualShelter, Travelers Insurance

Compare Homeowners Insurance Rates

To quickly find and compare rates in your area, enter your ZIP code below.

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