The 5 Best South Carolina Homeowners Insurance Companies
For all its beachy beauty, the Palmetto State has the 12th-highest average homeowners’ insurance premium in the United States at $1,214 (the national average is $1,096). That’s pretty steep, considering that South Carolina’s median home price is $188,000 — far lower than the US median of $244,100. The reason? Hurricanes.
Preparing for hurricanes is a way of life in South Carolina. Hermine, the ninth tropical cyclone of the 2016 Atlantic storm season, knocked out power for about 274,000 people and caused about $500 million worth of damage. Three of the costliest hurricanes to ever hit the United States also happened to do their damage in South Carolina (Hurricane Hugo in 1989, and Hurricanes Charley and Frances in 2004). Historic storms and floods in 2015 underscored the importance of homeowners’ insurance in the state, particularly for houses on the coast.
Thankfully, the competition for homeowners’ insurance is “as competitive as it’s ever been,” according to South Carolina Insurance Director Raymond Farmer. That competition helps drive prices down. And as it is premiums will always vary depending on your ZIP code, home, and other factors. Use our quote tool to compare rates in your area.
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We followed a similar method to the one we used in our review of nationwide insurers to find the best homeowners insurance providers in South Carolina. We interviewed experts to find out what makes the state’s insurance laws and risks unique. We read dozens of articles to get a sense of insurance pricing and coverage trends in the Lowcountry. Then we carefully reviewed the top five home insurance providers in market share. We got quotes online and by phone for a hypothetical home in Columbia, SC to get a sense of the process. We reviewed policies to make sure the companies offered key coverages. We also checked out extensive ratings and reviews from consumer advocacy groups and ensured the financial health of each company with credit raters.
South Carolina Home Insurance Reviews
It’s hard to find any insurance company with near-universal approval from independent raters, but USAA comes close: Consumer Reports readers gave it an overall score of 92. (State Farm had an overall score of 82). USAA’s financial backing is also stronger than any of the four companies we tested, with a near-perfect credit scores from Moodys (“Aaa”), A.M. Best (“A++”), and S&P Global (“AA+”). In other words, the odds that the company will go under and not be able to pay you are very slim. Consumer Reports readers gave USAA a perfect score of 100 when it comes to paying customers on time after making a claim.
There’s one big catch with USAA: it’s only open to active and retired US military members and their families. If you qualify, it’s a good option and our top choice of the five we tested.
Without an account, it’s near impossible to get an idea of USAA’s pricing and products. Their website is thin on details and educational materials. We used a current customer’s account to get an idea of the USAA experience and their quotes.
The bottom rate for insuring our Columbia-based home was about average for the companies we tested. Based on the information we gave, USAA offered us discounts for bundling our home and auto insurance, having a recent claims-free history, having a younger home (ours was built in 1998), and for any efforts we put toward windstorm mitigation, such as a stronger roof or stormproof windows. In all, those discounts totaled at $687, which would put us at a very reasonable $1,030 per year. Remember, your rate will vary considerably depending on where you live and what discounts you qualify for.
We liked how easy it was to customize our rate depending on need. USAA requires two separate deductibles: one for wind and hail damage, and one for all “other covered perils.” Both deductibles require you to pay a minimum deductible amount that you can toggle, which will change the rate. Our quoted rate had a $1,000 minimum deductible for “all other perils;” move that down to $500, for example, and your annual premium will go up $50 annually on the year.
By market share alone, State Farm is in its own class — as of 2015, it underwrites 23.3 percent of all homeowners’ insurance policies in South Carolina. Allstate is a distant second, writing 10 percent of all home policies.
But is State Farm’s popularity warranted? In some ways, yes.
For one, it has a rock-solid financial reputation from the major credit raters (an “A++” from A.M. Best and an “AA” from S&P Global — among the highest ratings you can receive). State Farm’s claims experience also gets praise: JD Power and Associates gave it a score of 80, or above-average. That puts State Farm ahead of three other top insurers we tested (Allstate, Nationwide, and Travelers, which all received scores of 60) and on par with USAA.
The home we used in quotes valued at $260,000, and State Farm quoted us $1,551 per year, which comes to $129.95 per month. (That included $122 in annual discounts for claims-free history and automatic sprinklers.) If we were to bundle that with our auto insurance, we’d pay a very reasonable $85 per month.
Like USAA, where State Farm sets itself apart is in the easy customizability of its quotes and coverage. At our quoted rate, in the event of a claim, we’d pay one percent of the total cost, with a $1,000 minimum. Take your deductible up to five percent, though, and State Farm will reduce our monthly premium all the way down to $97 per month, or about $1,162 per year.
You also have the option of tacking on numerous optional coverages (also known as endorsements). For an extra fee, State Farm will cover your home at 20% more of its value (known as extended replacement cost). It’s an endorsement that’s often worthwhile for older homes, where the cost of replacing and reconstructing can often cost more than the quoted value of the home. We liked that State Farm also offered optional coverage for upgrades required by building codes. If you have a historic home, for example, and are required by a local ordinance to make repairs, State Farm will cover you at a percentage you can determine. Nationwide was the only other insurer to offer this endorsement.
Nationwide was a bit more costly than the rest — $2,696 per year, to be exact. Compare that to State Farm ($1551 per year) and USAA ($1717 per year) and the price looks pretty steep. But it’s slightly better than it seems on the surface. That’s because Nationwide charges only a flat $1000, all-perils deductible. In other words, regardless of what happens to your home, you’ll pay $1000 and Nationwide will take care of the rest. State Farm, on the other hand, has an all-peril deductible at a lower annual rate but a one percent deductible. If you had a home valued at $250,000 with a one percent deductible, you’d pay $2,500 to your insurance company.
If you’re likely to make multiple claims, Nationwide’s high rate/low-deductible method may well be worth it. Anyone in high-risk storm areas used to wind damage, or those with older homes, may find the $1000 flat deductible and higher annual rate to be a better deal. However, we’d prefer more price flexibility.
That said, Nationwide backs up its higher annual price with solid service and strong financials. It’s a hit with independent raters, and its strong scores with JD Power (80) and Consumer Reports (84) bested competitors State Farm, Travelers, and Allstate. When it comes down to making a claim customers were very satisfied with Nationwide. JD Power and Consumer Reports both said the claims experience was “above average.”
We also were comforted by the wealth of educational tools Nationwide provides for homeowners pro bono, including a personal finance guide and a thorough guide for disaster preparedness and home safety tips. You can even track claims and pay your bill through their mobile app. When we finished retrieving a quote, Nationwide had a check box asking us if we’d like to be contacted by an agent. Most companies don’t even bother asking your consent before they start hounding you. We liked having the option to dodge it.
We rated Allstate as “Best for First-Time Homeowners” in our review of the top nationwide providers of homeowners’ insurance. The website has many educational resources and tools to help a new homebuyer make an informed decision. Pull up the company’s Common & Costly Claims tool, plug in your ZIP code, and you’ll get a list of the most common threats in your area.
However, our experience with Allstate in South Carolina left a few things to be desired. Halfway through the quote process, the website directed us to contact a local agent instead. We emailed the agent to finish up our quote. The next day, he directed us to another colleague in his office, who never got back to us with a quote. A few days later, he apologized — he had been backed up with requests after a storm. We couldn’t fault him for that, but if the online quote system had worked in the first place, we wouldn’t have had to worry about bothering another human.
Allstate’s strengths are in its online presence and offered discounts. It offers price cuts for new members, signing up for online auto-pay, and smoke-free homes, which no other competitor we tested offered. Remember, though, your quote will vary depending on many factors, and more discounts may be available if you speak to an agent.
Travelers didn’t really stand out in any way. Chief among our concerns are customer complaints about the claims process. Of the five companies we tested, JD Power and Associates gave Travelers some of the lowest scores we saw (2 out of 5 each for for contacting the insurer, claims process, and policy offerings). Consumer Reports readers were about equally unimpressed, giving them one of the lowest scores (40) for the amount of premium paid in a survey of the 14 top companies
One of our other gripes about Travelers was its subpar customer experience. Midway through trying to get an online quote, we were directed to call an agent. In addition, its educational resources for customers paled in comparison to sites like Allstate, State Farm, and Nationwide, who had extensive databases and easily accessible forms, such as a downloadable form for scheduled valuables.
Did You Know?
Most of the damage from 2015’s storms was caused by flood insurance — and not many people had it.
They called it a “one-in-1,000-years” flood. In 48 hours, some parts of South Carolina got dumped with more than 2 feet of rain. South Carolinians on the coast are well accustomed to the threat of hurricanes, but the flooding caused by the 2015 storms caught many homeowners off-guard. Many areas were hit with floods that were not in high-risk flood areas and never been flooded before, said Frank Sheppard, president of the Independent Insurance Agents and Brokers of South Carolina, to Insurance Journal.
Making matters worse is that not many people have flood insurance to begin with — only 10 percent of all South Carolinians had it before the storm, says the New York Times.
In light of the disaster, it’s worth noting that most private insurers do not provide flood insurance as part of your homeowners’ insurance policy. You must purchase it separately from South Carolina’s National Flood Insurance Program, a government organization and subsidiary of the Federal Emergency Management Agency (FEMA). According to the New York Times, the average flood insurance premium runs about $700 per year, though it could be higher in riskier areas. Talk to an independent insurance agent to see if your home is a good fit for flood insurance.
If your roof was replaced right after Hurricane Hugo, your insurer may make you do it again.
After Hurricane Hugo devastated South Carolina in 1989, contractors scrambled to repair and replace damaged roofs. In their haste, and due to the high demand for good roofing materials, many of the contractors used lower-quality asphalt shingles, says the Charleston Post and Courier. Contractors and SC roof experts call these shingles “Hugo roofs.”
These roofs were necessary at the time, but they weren’t built to have staying power beyond 20 years. They are prone to deteriorate faster due to persistent high heat, moisture, and sun in the Lowcountry.
Best believe, insurance companies have taken notice of the junky-roof trend. If you have a Hugo roof, a provider may refuse to insure your home unless you replace the roof.
The good news: Since Hugo, roofing material quality has improved, with many people choosing metal roofs that can better reflect sunlight and stave off heat and damage. And if you splurge for a certified impact-resistant roof, many insurers, including Allstate, State Farm, and USAA, will discount your annual premium. Look to see if you qualify for a grant through the Safe Home program, which provides assistance to homeowners who reinforce roof-to-wall connections and roof coverings.
Before you look to replace a roof, be sure to get multiple quotes and compare them. Also make sure to check the bona fides of the roofer — request proof of their liability insurance and certifications. You can see if they’re licensed to do business through South Carolina’s online government database. In some states, such as in Colorado, there has been a rash of “storm-chasers,” otherwise known as unlicensed contractors who, after a bad storm, go door-to-door offering to repair roofs, but end up performing shoddy work that will get you in trouble with your insurance carrier.
Rates will vary considerably depending on where you live.
Take a look at these annual rates for the five most populous counties in South Carolina:
Home valued at $200,000
Home valued at $350,000
**For a 10-year-old home with a frame foundation, for a user with good credit, no claims in the past 5 years. Source: South Carolina Department of Insurance
Charleston’s historic antebellum architecture and beaches make it one of the most popular destinations in the United States. Unfortunately, they also contribute to its high premiums. It costs more money to insure older homes — they are not as structurally sound as newer homes, and their replacement materials can be hard to find. That makes them a liability in the eyes of an insurer. More than one-third of the homes in District 6, which includes Charleston County, were built before 1970, and almost 20 percent were built before 1950.
And Charleston’s geography, smack-dab in the tropical storm zone, makes premium prices shoot up. Horry County, which contains Myrtle Beach, has similarly high annual insurance prices for its geography. Meanwhile Greenville, which sits inland on the northwest corner of the state, enjoys lower premiums, as it is relatively sheltered from the threat of high winds and storm damage.
The Bottom Line
With inclement tropical weather a constant in South Carolina, it’s ever more imperative to get coverage that fits your home and situation. Be sure to conduct independent research on quotes and catalog your home’s unique needs. Check out our quote tool below to get an idea of rates in your area.
Find the best homeowners insurance in your area.
Get a quote by entering your ZIP code and start saving today.