Illinois Homeowners Insurance Guide
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The Prairie State is home to the 3rd largest city in the U.S. (Chicago), but is also approximately 80% farmland. So, you can certainly enjoy the bustling city sites of the John Hancock building, Water Tower, or Grant Park. But the overwhelming majority of Illinois is dedicated to farming; essentially living up to its name of the Prairie State.
Due to its landlocked nature, Illinois is virtually insulated from the typical natural disasters that plague coastal states such as Florida, California or Alabama. And although the state isn’t directly impacted by hurricanes or other tropical storms, Illinoisans do have to deal with flooding, tornadoes, and ice from extreme winter weather. In addition, due to its size, Lake Michigan can also wreak havoc on the Prairie State. Not to the extent of the Atlantic or Pacific oceans, but pretty close.
Most Illinoisans and people who own or rent property in the state can be sufficiently covered by a standard homeowners or renters policy. Coverage for perils such as theft, vandalism or fire are typically the extent of exposure for property in the Prairie State. As a result, property owners in Illinois enjoy significantly lower insurance rates than the rest of the country.
Average Homeowners and Renters Insurance Premium
Source: Insurance Information Institute (2017)
The Prairie State isn’t highly susceptible to catastrophic losses due to weather, however, it is located in tornado alley, floods quite a bit, and can accumulate a significant amount of lake effect snow. Coverage for losses resulting from disasters such as these can be found through the National Flood Insurance Program (NFIP) and the Illinois Fair Plan (FAIR); an association created for those risks that could not find coverage in the open market.
Given Illinois’ geographic characteristics, the standard homeowners or renters policy provides adequate coverage for most property owners’ risks. As a result, Illinoisans should make sure to compare rates from both regional and national carriers.
Top 5 Home Insurance Carriers in Illinois
|American Family Insurance Group||5.9%|
|Farmers Insurance Group||5.5%|
Source: Insurance Information Institute (2019)
Larger national carriers control much of the market, but since coverage against natural disasters isn’t paramount, finding a smaller regional carrier or mutual company could yield significant savings. Given there is virtually no risk of suffering weather-related catastrophic losses, most insurance carriers don’t carry a high probability of becoming insolvent. Thus, Illinoisans have an array of choices for homeowners and renters insurance.
Whether you own property along Lake Michigan, in the heart of the Windy City, or a house on the prairie; Illinois’ geographic location affords property owners a host of insurance carrier options. As a result, Illinoisans are typically adequately covered regarding their property insurance needs, and at favorable rates when compared to the rest of the country.
Illinois Department of Insurance
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