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By: Ramu Garuda  August, 14, 2019

A Gavop analysis shows that Georgia’s homeowners pay an average homeowner's insurance premium of $1,103, which is 10% lower than the national average of $1,228.

The following table shows that the average insurance rate increases with a rise in coverage amount for all policy types. In addition, the insurance rates for dwelling fire premiums are significantly lower than those for the five 5 homeowner’s policy types.

Average_premium_georgia

The HO-1 policy is a basic “named perils” policy that covers buildings and personal property. Homeowners in Georgia with insurance coverage that is less than $49,999 pay the lowest insurance rate of $415 per annum. On the other hand, those with insurance coverage $400,000 and above pay the highest rate of $2,099. In Georgia, the average homeowner pays about $931 per annum under the HO-1 policy.

The HO1 covers damages to housing structures, possessions within the home, and structures on the property land caused by

  • fire/lightning
  • windstorm/hail
  • vandalism
  • malicious mischief
  • vehicles
  • aircraft
  • explosions/riots
  • glass breakage
  • smoke
  • volcanic eruption
  • personal liability

Compared with the HO-1 policy, the HO-2 policy is a broader “named perils” policy that covers damages to buildings and personal property. Homeowners with insurance coverage worth $49,999 pay an average insurance rate of $394 per annum. On the other hand, homeowners with insurance coverage worth $500,000 and above incur an average insurance rate of $1,882. Under the HO-2 policy, Georgia’s homeowners pay an average insurance rate of $928. The policy covers the following:

  • Damages caused by falling objects
  • Damages due to the weight of ice, snow, and sleet
  • Damages caused by the accidental discharge of steam or overflow of water
  • Sudden and accidental tearing apart, cracking, burning, or bulging
  • Accidental damages from artificially generated electrical current

The HO-3 policy offers all-risks coverage for buildings and broad named-peril coverage for personal property. In addition to being the most comprehensive homeowner policy available in the market, the HO-3 policy is the most common insurance package written in Georgia.

The policy covers housing structure, excluding the home contents, against all perils except those specifically excluded.

Homeowners with insurance coverage that is $49,999 or below pay an average insurance rate of $380 per annum, while those with insurance coverage $500,000 and above incur an average insurance rate of $2,369 per annum. Under the HO-3 policy, Georgia’s homeowners incur an average homeowner's insurance rate of $1,045 per annum.

The HO-3 policy covers the following scenarios:

  • Earthquakes
  • Ordinances or laws passed by the state
  • Damages caused by water
  • Loss due to power failure
  • Damages attributable to neglect by the homeowner
  • War
  • Nuclear hazards
  • Intentional loss
  • Governmental action
  • Theft while the dwelling is under construction
  • Vandalism/malicious mischief on property vacant for more than 60 days
  • Damages caused by mold, fungus, or wet rot
  • Deterioration due to wear and tear
  • Mechanical breakdown
  • Damages due to smog, rust, or corrosion

The HO-5 policy provides “all-risks” coverage on buildings and personal property, excluding damages caused by floods or earthquakes. The HO-5 policy is available for properties that were either built after the last 30 years or renovated within the past 40 years.

HO-5 policyholders in Georgia with insurance coverage worth $49,999 incur the lowest insurance premium of $161 per annum. Homeowners with insurance coverage worth $500,000 pay an average insurance rate of $2,997 per annum. Under the HO-5 policy, the average homeowner in Georgia incurs a premium rate of about $854 per annum.

Finally, the HO-8 policy is suitable when repair costs for a dwelling are significantly higher than the market value. Homeowners with properties older than 40 years generally opt for the HO-8 policy because their homes may not meet the requirements of the HO3 policy.These include upgrades to the heating, ventilation and air conditioning, electrical systems, plumbing, and roof. Under the HO-8 policy, homeowners with insurance coverage of $49,999 pay the lowest insurance rate of $429 and those with a coverage of $500,000 and above incur the highest insurance rate of $2,719.

The following graph shows the average insurance premium rates for the largest cities in Georgia: Savannah, Atlanta, Columbus, Augusta, Macon, and Athens.

Average_insurance_rate


ABOUT THE AUTHOR

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Ramu Garuda

Ramu is a research analyst with over 9 years of analytics & research experience. Prior to joining the company, he worked with some of the prominent consulting and market research firms in India, including Pride Technology (Supporting consulting projects to PWC), RR Donnelly, and The Hackett Group. His skills include company profiling, benchmarking, data and trend analysis, industry analysis, and report writing across the industries. Ramu holds a Master’s degree in Finance and Marketing. He also has a bachelor’s degree in Biotechnology.

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