Homeowners Insurance in New Jersey
Homeowners insurance in New Jersey isn't as simple as buying houses in Monopoly, but it doesn't have to be complicated, either.
Whether you live on Boardwalk or Baltic Avenue (yes, those are real streets in Atlantic City!), protecting your home is key. Because, unlike the plastic houses in the game, your real home faces risks from storms, theft, and accidents.
This guide is your friendly instruction manual for understanding New Jersey home insurance. We'll walk you through the basics, explain costs, and help you choose the right coverage.
So, let's roll the dice and start your journey to protecting your home — no "Get Out of Jail Free" card required!
What is the average homeowners insurance cost in New Jersey?
Home insurance in NJ costs an average of $1,323 per year — the same price you’d pay for about 25 Pork Rolls, a New Jersey delicacy. However, if you’re from North Jersey, you may be more familiar with their other name, Taylor Ham Rolls. Either way, they’re still delicious.
This average premium is about $1,200 cheaper per year than the U.S. average, which is $2,522, according to Insurify data.
This table shows how average rates in New Jersey have fluctuated over the years:
Year | Average annual Premium |
|---|---|
2024 (projected) | $1,323 |
2023 | $1,267 |
2022 | $1,299 |
2021 | $1,309 |
2020 | $1,277 |
What factors influence my home insurance rate?
If you’ve ever received a home insurance quote in New Jersey, you might notice that your actual premium is a bit different than the state average. That’s normal, as your rate is dependent on several factors:
- Your location. Living near the Jersey Shore might increase your risk of flood and storm damage, which could potentially lead to higher rates compared to inland areas.
- Home size and age. A historic Victorian in Cape May may have higher premiums than a newer suburban home in Morris County.
- Claims history. Having recent claims on your record can increase premiums.
- Credit information. New Jersey insurers can use credit-based insurance scores to help determine your rate.
- Coverage amount and deductible. Choosing higher coverage limits or lower deductibles can increase premiums.
- Special features. Anything high-risk or high-end, including swimming pools, fancy appliances and expensive building materials, can increase your premiums.
Common insurance discounts in New Jersey
In New Jersey, these common home insurance discounts can potentially save you money on your policy:
- Multi-policy discounts. You could save up to 20% on premiums when you purchase two insurance policies from the same company, such as getting both home and auto insurance through Hippo.
- New home discount. Insuring a newly built home can save you up to 40% on insurance in some cases.
- Safety features discount. Installing smoke detectors, security systems, or fire extinguishers can land you a discount of up to 5%.
- Storm-resistant features discount. Adding an impact-resistant roof or other storm-resistant upgrades could qualify you for reduced home insurance rates.
- Claims-free discount. Some insurance companies in New Jersey will give you a home insurance discount of up to 20% if you haven’t filed a claim in the past three to five years.
- Retiree discount. Being a senior or retiree could also score you a discount on home insurance.
- Loyalty discount. An insurance company may reward you with a discount if you’ve been with them for multiple years.
Tips for lowering home insurance rates
New Jersey residents know a thing or two about smart shopping, given the state's abundance of malls. However, saving on home insurance requires more than just coupon-cutting skills. These strategies could potentially save you hundreds without sacrificing coverage.
- Increase your deductible. If your premium feels too high, choosing a larger deductible will help lower it. But remember, you may pay this amount when you file a claim, so make sure you have enough savings to cover it.
- Raise your credit score. Nerdwallet found that customers with poor credit pay 95% more than customers with good credit for the same insurance policy in New Jersey.
- Reduce potential risks. Keeping up with home maintenance will make your home run smoother and potentially reduce the number of claims you have to make. This could include updating the older parts of your home, such as your roof, windows and HVAC system.
- Compare quotes annually. Shop around for NJ homeowners insurance quotes each year, and don’t be afraid to change home insurance providers if you find a better deal somewhere else.
What does New Jersey home insurance cover?
NJ homeowners insurance will cover your home’s structure, contents, liability, and even any additional structures on your property that are damaged due to covered perils.
Here's what you can expect from a typical policy:
- Dwelling coverage. This protects the structure of your home. For instance, if a severe coastal storm damages your roof in Ocean City, this coverage would help pay for repairs.
- Other structures coverage. This covers detached structures on your property, like a garage or shed. If you have a pool house in your Cherry Hill backyard, it would be protected under this coverage.
- Personal property coverage. This is for your belongings — whether it's your furniture in Montclair or your prized Bruce Springsteen memorabilia collection in Asbury Park.
- Loss of use coverage. This helps cover temporary living expenses if you can’t live at home after a covered loss.
- Personal liability coverage. This protects you if someone is injured on your property. For example, if a guest slips on your icy driveway in Morristown, this coverage could help with legal expenses.
- Medical payments coverage. This covers minor injuries to guests on your property, regardless of fault.
Additional New Jersey insurance coverage options
In addition to standard home insurance, you can round out your coverage with any of these additional options:
- Flood insurance. Flood insurance is a must, given New Jersey's coastal location, history, and events like Hurricane Sandy. Standard policies don't cover flood damage.
- Wind and hail coverage. Windstorm insurance is often included in standard policies, but it's still worth confirming if you live in areas prone to severe storms.
- Water and sewer backup coverage. This protects against damage from backed-up sewers or drains, which can be a common issue in older homes.
- Earthquake insurance. Although earthquakes are rare in New Jersey, they can still happen. This coverage protects against earthquake-related damage.
- Hurricane insurance. Given New Jersey's vulnerability to hurricanes, adding riders like hurricane insurance can be a must.
- Valuable items coverage. If you’re looking to protect specific valuables, riders like jewelry insurance and scheduled personal property are the way to go.
- Home-based business coverage. If you run a business from your home in New Jersey, this covers business equipment and liability that standard policies might exclude.
What coverage is recommended in New Jersey?
New Jersey's diverse landscape and weather patterns mean that insurance needs can vary greatly from one area to another. A homeowner in Cape May might need different insurance than someone in Morristown. Still, it’s recommended to have these minimums in place:
- Enough dwelling coverage to rebuild your home if it's destroyed.
- Enough personal property coverage to replace all your belongings.
- Enough liability coverage to protect your assets if someone sues you.
- Flood insurance if you live near the coast, in a flood zone, or in a low-lying area.
- Wind and hail coverage if you're in an area prone to severe storms or hurricanes.
- Water and sewer backup coverage if you have an older home or live in an area with aging infrastructure.
- Valuable items coverage if you have fine jewelry or high-end collectibles.
- Home-based business coverage if you run a business from your home.
Talk to a Hippo insurance agent to figure out what coverage you need based on your area.
Insuring your home in New Jersey
You typically follow these steps to insure a home in New Jersey:
- Determine how much home insurance you need.
- Grab at least three homeowners insurance quotes in New Jersey.
- Compare your coverage options.
- Choose the policy that best fits your needs and budget.
- Review your policy each year to make sure it still fits your needs.
New Jersey has several resources to help you with home insurance:
- The NJ Department of Banking and Insurance gives guidance on consumer protection.
- The National Flood Insurance Program (NFIP) offers flood coverage.
- The Fair Access to Insurance Requirements (FAIR) program—run by the New Jersey Insurance Underwriting Association—provides basic home insurance coverage for those who can't get insurance elsewhere.
Is New Jersey homeowners insurance required by law?
There are no NJ homeowners insurance laws that require you to have a policy. However, if you still have a mortgage on your home, your lender will require you to have insurance as part of your loan agreement.
If you have a mortgage and don't buy insurance, your lender will buy it for you. This is called force-placed insurance. It's usually more expensive and only protects the lender, not you or your stuff.
Even if you own your home outright, insurance is a good idea. The average home price in New Jersey is $537,916. This doesn’t include the cost of replacing your belongings and covering potential liability issues.
Home insurance chips in and helps with these costs. Without it, you're taking a big financial risk.
Related reading: Getting Home Insurance Before Closing [Pre-Close Prep]
Looking for homeowners insurance in a different state?
Still have questions?
Still wondering how New Jersey home insurance quotes work? Browse these frequently asked questions:
Why is homeowners insurance going up in New Jersey?
NJ Homeowners insurance rates are rising due to several factors: increasing natural disaster risks, especially coastal storms; higher construction and repair costs; and general inflation. Also, the state's dense population and aging housing infrastructure may contribute to a higher number of claims for insurers.
Is it illegal to not have homeowners insurance in NJ?
It's not illegal to not have New Jersey home insurance. But you could be breaching your lender’s contract if you have a mortgage with no insurance. No matter your mortgage situation, insurance is strongly recommended as a way to financially protect you from potential disasters or liability claims.
Why are insurance companies leaving New Jersey?
Insurance companies may stop issuing policies in certain states if it becomes harder to stay profitable there. This usually happens when states have strict regulations, or there’s an uptick in severe weather or natural disasters.
How much is homeowners insurance in Newark, NJ?
In Newark, home insurance costs about $1,692 per year or $141 per month, according to Insurance.com data. This is slightly higher than the statewide average. Your actual cost might be different based on how much your home is worth and what kind of coverage you choose.
What is the hurricane deductible for homeowners insurance in NJ?
Hurricane deductibles in New Jersey are usually 1% to 5% of your home's insured value. This is a special deductible that applies only when a named storm has sustained winds of 74 miles per hour. For example, if your home is insured for $500,000 and you have a 3% hurricane deductible, you'd pay $15,000 before your insurance starts covering damage.
