The 5 Best Arizona Homeowners Insurance Companies
The dry heat and unique beauty of Arizona’s desert landscapes make a great backdrop for a new family home or snowbird vacation paradise. However, that same alluring terrain can also be prone to sudden and extreme weather changes. Remember 2010’s freak hail storm that brought 2-inch hail stones crashing down on the Phoenix area for a shocking $2.7 billion in property damage? Consider the wrath of wildfires (the 2013 Yarnell Hill fire destroyed 8,400 acres and $17 million-worth of property) and subsequent risk of flash floods, and you might want to take a closer look at homeowners insurance options, even if those big desert skies are blue at the moment.
Though the average cost of homeowners insurance in Arizona ($692) is considerably cheaper than the national average ($952), you’ll want to make sure that your home or vacation property has standard coverage in addition to provisions for sudden natural disasters. Make sure that weather catastrophes such as hailstorms, fire, and floods are mentioned, that your provider has excellent financially stability ratings and claims records to pay out promptly, and be on the lookout for discounts available to a wide range of Arizonans such as military families and the over-55 crowd.
Check out the quote tool below to get a better idea of what you can expect to pay to cover that desert hideaway of your own.
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While Amica Mutual was our top pick for homeowners insurance nation-wide, we zeroed in on the top providers in the Grand Canyon State. We did the leg work to rank the five largest providers in Arizona by marketshare on the following criteria:
- Practicality: the coverage options that are best for AZ with the most available discounts
- Reputation: ratings for financial stability, processing claims, and customer satisfaction
- Experience: our own perspective as shoppers, right through getting a quote for an actual home in Phoenix
Arizona Homeowners Insurance Reviews
American Family came out as the all-around winner in terms of what we were looking for. It has the largest number of endorsements for the widest possible coverage and addressed our main concerns such as fire, hail, and even more that we didn’t even consider, like sewage backup (yuck). There are a plethora of resources available on the website, including a live chat box and an app called DreamVault for logging personal property, which is important in the event of filing a claim and easy to blow off until the unexpected hits. Its customers agree with us, contributing to the highest overall satisfaction score from J.D. Power of the companies on our list at 4 out of 5. This was accompanied by solid ratings for claims processing from Consumer Reports (79 out of 100) and financial stability from A.M. Best (A+).
A major drawback is that we couldn’t get a quote online. The quote tool will simply forward your info to a local agent of your choosing. That’s a bit annoying considering that other companies like State Farm managed to cough up a quote for our Phoenix abode, which was more convenient and less intimidating than waiting for an American Family agent to call. Also, unlike Farmers and Allstate, American Family does not write flood insurance, so you’ll have to go through the whole process elsewhere to get that recommended add-on (more details below.) Overall, though, the sum of all of its parts positions American Family as the most well-rounded home insurance option in the state.
At a very close second place, Allstate shines for excellent financial stability ratings, including an A+ from A.M. Best, and numerous endorsements, covering the Arizona concerns and some unique situations that could arise as well. As of May 2016, Allstate is offering an endorsement for home sharing coverage, so if you’re renting out your vacant vacation home out on Airbnb and the entertainment center goes missing, Allstate can help you out you whereas most other providers would turn up their noses and go back to figuring out online quoting. It also writes flood insurance policies which makes for convenient shopping, and can even get you a discount for bundling your coverage.
What bumped Allstate to second place were claims processing ratings from Consumer Reports and JD Power. While said scores were still quite respectable, Allstate came in slightly lower than American Family according to Consumer Reports readers and J.D. Power overall (3 out of 5 and 77, respectively.) Also, in our experience, the online quote process was a little circuitous — you have to select your state and then choose a local agent first, but you still walk away with some hard numbers. Our Allstate quote was higher than the other quotes we got ($1,413 annually at the lowest), but there was a clear layout of three tiered options and their differences. This was coupled with a cool “coverage in action” tool that outlined the three tiers in different scenarios, which was helpful and practical. With services to suit the on-demand generation and the only one of our top five to offer a 55 and older discount, Allstate seems to have something for everyone.
Another great option, Farmers comes with a stable reputation for financial stability — an “A” from A.M. Best and an “A+” from Standard and Poor’s. Though its combined ratings for claims processing came up the lowest-performing of our top five, its online resources for customers stand out. The FAQ section is extensive, key endorsements are available and clearly outlined, and the website is overall sleeker and more intuitive than say, State Farm’s. As an added plus, Farmers can write flood insurance policies, so that could save you some stress when shopping around.
Farmers also had the lowest quote of the ones we got for our 3-bedroom Phoenix home, coming in at $923 annually, with the next up State Farm at $1,157. While the lowest rates are not necessarily the best thing in insurance world, it does get Farmers a few extra points for affordability in our book. This was also reflected in the number of discounts Farmers offers which was in fact, the highest of all providers we looked into, totaling twenty-seven different discounts mentioned, trailed by twenty-one available through Allstate. Even more discounts that weren’t mentioned elsewhere showed up later with our quote, such as lower rates for being an educator — a big thumbs up. As with Allstate, the quote also came with three tiered options but the differences between them were not as clear as with our number two. All in all, though, Allstate could be manna in the desert of homeowners insurance if savings are your top priority.
If we were evaluating the quote process alone, State Farm would rank first. Its online tools make the whole thing relatively painless: The form was able to auto-populate with a lot of information about our home using the address, and it included complimentary use of the 360Value tool to determine its replacement cost. (For homeowners insurance newbies — no, replacement cost is not the same as the home’s market value, and other sites recommend getting a professional to come out to your home to appraise it, or at the very least, paying $10 elsewhere online to use the service.)
Other online quote processes did not mention how they determined the replacement cost, so overall, we felt like this number was more transparent and reliable, and that feels nice. The quote was second to lowest of the ones we got, and though again, that’s not the best point of comparison, it was the best experience of all.
What knocked State Farm off that pedestal? We found too few discounts compared to the other providers and too few endorsements; in fact, the coverage details were not clearly listed anywhere on its website, and this left us wondering what would become of us in the event of a wildfire, nevermind a flash flood. This was paired with some lackluster online resources — just some videos to explain key concepts, and this made us yawn and wonder what Allstate was up to.
State Farm is still a solid choice, however, with excellent financial stability ratings including an “A++” from A.M. Best that was matched only by USAA. In claims ratings from Consumer Reports and J.D. Power as well, State Farm was only second to USAA, so take our opinion with a grain of salt (or Painted Desert sand).
If you or your family are active or former military (and with two major Air Force bases, a major Army base, a Marine Corp Air Station and Proving Ground, a National Guard training site, and a munitions storage depot all in Arizona, this is likely), you can benefit from USAA’s homeowners coverage. In keeping with the military theme, however, the USAA website is rather, well, tight-lipped. The descriptions of coverage are vague. For example, “most weather-related events” is not elaborated upon, and yet, we would really like to know if roof damage specifically from two-inch hailstones is covered. In general, there’s very little info readily available online, and discounts are alluded to, but not in the clear, listed-fashion with pretty pictures that Farmers spoiled us with. We weren’t even able to get a quote; this requires registering as a USAA member and the required info about military service and a social security number.
That said, that exclusive membership comes with an excellent reputation: stellar financial stability — the best ratings out of all of our options overall — and the best ratings for processing claims. With a Consumer Reports readers score of 92 (compared to State Farm’s 82), USAA clearly means business and has satisfied customers to prove it. And isn’t that what you really want in the end? An insurance company that will pay your claims quickly and reliably in the wake of a large scale disaster? If you’re eligible, it’s definitely worth checking out. If you’re not eligible, you still have four other fine options to choose from.
Flood Insurance in Arizona
I won’t need flood insurance — I live in the desert.
Think again. Between 2000-2010 alone, there were five federally-declared flood disasters in Arizona, according to the National Flood Insurance Program. Rainy bouts in the summer and winter have been known to wreak havoc on Arizona homes, such as heavy rains in the summer of 2006 that created a 20-foot surge of water and flood damage in 93 communities across the state. Wildfires in particular increase the risk for flash flooding: without ground cover, recently-burned land is less able to soak up rain and runoff, so a late summer sprinkle can quickly snowball, spelling trouble for residents of mountain slopes and canyon country.
If you didn’t know you needed flood insurance, you’re not alone. Most standard homeowners insurance does not include flood coverage, and a mere 19 percent of the state’s buildings in high risk areas are covered. To assess the flood risk in your area, enter your address at Floodsmart.gov and see for yourself. Even if you think your area is in the safe zone, the Arizona Department of Emergency and Military Affairs cautions that up to 25 percent of all flood insurance claims come from low-risk areas. You have been warned.
Ok, ok. I’ll get flood insurance. How can I do that?
Glad you asked. Some companies like Farmers and Allstate offer flood insurance policies, so inquire with your chosen provider. If they don’t offer you what you need, call the National Flood Insurance Program at (888) 379-9531 to find an agent who can.
The Arizona Department of Insurance also offers this flood insurance fact sheet with simple, helpful info, like this: If your area is moderate-to-low risk, you may be able to get coverage for just $119 a year with a Preferred Risk Policy (PRP) — not a bad investment. Note that if your home is not in a flood risk zone and you still want coverage just to be safe, you may need documentation from your local County Flood Control District office, so allow time for that process.
When should I add flood insurance?
Get it now. Unlike homeowners policies, flood insurance typically takes at least 30 days to come into effect, so you’ll want to be squared away well in advance of the rainy season. Don’t wait for a flash flood to wash away all the hard work you did in purchasing a home and securing the best homeowners insurance in Arizona only to miss a crucial piece of coverage.
The Bottom Line
American Family is our top pick for Arizona thanks to its plethora of endorsements and large range of coverage options — the largest of all the competition. But remember, quotes can vary greatly from place to place, so make sure to apply for several policies to find the best coverage for your needs. Oh, and be sure to consider flood insurance too.
Find the best homeowners insurance in your area.
Get a quote by entering your ZIP code and start saving today.