The 5 Best Iowa Homeowners Insurance Companies
Iowa’s annual premiums for homeowners insurance are on the low side — on average $853 per year for an HO-3 policy, compared to the nationwide average of $1,132. That said, how much you’ll pay can vary a lot depending on your home’s size, your assets, and your address. Use our tool to find your best rates:
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Every so often, rural Iowa gets disrupted by natural disasters, like tornadoes and torrential downpours. Iowa is considered part of Tornado Alley, and on average, it gets 9 tornadoes for every 10,000 square miles each year — the seventh-most in the United States. Such events are sobering reminders how important it is to have a strong homeowners insurance policy.
The average HO-3 homeowners insurance premium in Iowa is $853, well below the national average of $1,132. However, that price can vary considerably depending on where you’re located, the age of your home, what coverage you need, or if you have a trampoline, pool, or farm on your property, for example, as we were warned before starting our quote with Nationwide.
Check out our homeowners insurance quote comparison tool to get a sense of premiums in your area.
How We Found the Best Homeowners Insurance in Iowa
To find the best homeowners insurance in Iowa, we followed a similar method to our review on national providers. We found the top five homeowners insurance providers in Iowa by total market share. Then, we carefully reviewed them on a variety of factors from policies to education material to financial stability. Finally, to get a sense of the company’s premiums, policies, and customer service, we solicited a price quote for homes in Iowa. Keep on reading to find out how each company came out in the end.
Iowa Homeowners Insurance Reviews
Auto Owners Group
Auto-Owners also insures homeowners, and it just so happens to be our top choice of the five companies we tested. The foremost reason for that decision is that Auto-Owners is one of only 12 home insurance companies to receive an A++ credit rating from independent rater A.M. Best. Plus, Consumer Reports readers gave it a perfect score in the “timely payment” category for when claims payment time came around (note: Iowa Farm Bureau was not rated by the customer satisfaction surveys or by major credit raters).
An interesting wrinkle to Auto-Owners is that doesn’t have corporate insurance offices, like American Family, Nationwide, and State Farm do. Auto-Owners coverage is available only through independent agents, who can help homeowners “get the coverage they need” and compare quotes from multiple insurance companies. You don’t find many companies that aren’t immediately grubbing for your money and instead willingly ask you to compare their coverage against competitors. We thought it demonstrated Auto-Owners’ confidence in its product. It takes away the convenience of getting a quick quote online, instead encouraging a face-to-face relationship with a local agent. And while you have to call to learn about quotes, Auto-Owners still made its coverage options clear and up-front on its website, and has many options for discounts.
Lastly, Auto-Owners is one of few private companies that offer optional flood insurance. So in the event of a flood, we like Auto-Owners’ exceptional claims experience against that of the government-run National Flood Insurance Program, which can be spread thin for resources during a disaster.
State Farm insures more homes than anyone in Iowa, and it backs up its lofty customer numbers with wide coverage options and fair premium prices.
We like the ease with which you can get a quote on your house online — just plug in your address, some information on your home, and desired coverages, and you’ll have a ballpark quote within about five minutes. It’s easy to edit the quote too. Wanna move your deductible from one to two percent? Just update your numbers in a drop-down box and your annual premium price will adjust accordingly, no muss, no fuss. Auto-Owners, Farmers, and American Family Insurance all require you to talk to an agent first for a quote. You may well prefer that, but we like the option of having our options laid out in front of us before we get a sales pitch.
The other big plus with State Farm is its credit rating: a solid AA from S&P, almost the highest score you can receive, and A++ from A.M. Best. It loses luster with some consumer ratings: JD Power and Associates gave it an overall rating of 60, and Consumer Reports readers gave it an okay overall score of 82, beat out by Nationwide (84) and Auto-Owners (89). In all, State Farm is a solid choice for its financial rep and its convenience, but there may better options out there.
From the minute we started our online quote, we felt comfortable with Nationwide. It is easy to quote online, and it was a cinch to edit coverages. Off the bat, this convenience gave it a tiny edge over Farm Bureau, Auto-Owners and American Family Insurance, who require you to talk to an agent first. Sometimes we just want a quote, not a heart-to-heart with an agent.
As far as coverages go, Nationwide has some of the best coverages for personal property. Most interesting was the way it covers appliances and belongings. Its “Equipment breakdown endorsement” covers the cost of repairs for furnaces, air conditioners, refrigerators, and other large appliances that need to be repaired or replaced due to breakdown, up to $50,000 in coverage per occurrence. It also gives you bonus coverage if you replace your appliance with one that is more energy-efficient and pollutant free.
For homeowners with heavy-duty home equipment, it’s an endorsement worth considering. In addition, we like the Brand New Belongings endorsement. If any of your personal property breaks down or is lost, other insurance companies (any here)? will pay you for its price with depreciation. In other words, a TV worth $1000 in 2010 may be only worth $400 in 2016. Nationwide’s Brand New Belongings endorsement protects against depreciation, giving you full replacement value for the item.
Iowa Farm Bureau
Farm Bureau doesn’t have an online quote system or a flashy website, but it makes up for it in personal, friendly customer service and clear policy offerings. Once we filled out a form requesting a quote, we received a response within a few hours. This was a stark contrast to American Family Insurance, which took days to respond to our request for a price quote.
“We keep insurance simple” is Farm Bureau’s motto, and that manifests in its price quotes. Instead of offering dozens of optional coverages and discounts, Farm Bureau just automatically bundles all of your insurance products together — for equipment, electronics, personal belongings, and cars, in addition to your home. That means its rates are higher — about 25 percent higher than competitors, judging from the quote we received. We personally like having more choice, but for customers that care less about price and want extensive coverage, Farm Bureau could be a good option.
As it is with most carriers, paying higher annual premium means you pay a lower deductible — Farm Bureau has a $1,000 standard deductible, and a $1,500 deductible for wind and hail damage. This was lower than Nationwide’s initial quote, which charged $2,500 for its deductible but had a lower annual premium, which you can adjust it to your liking.
Farm Bureau doesn’t offer many enticing discounts upfront—they believe it clutters and confuses the billing process—but they have a member loyalty program, where members receive rewards and discounts over the time of their membership. They also didn’t have a lot of scrutiny from financial raters and outside sources; A.M. Best gave them an A for financial stability, which was solid but lower than every other company we tested. In all, we admire Farm Bureau’s quest for simplicity and personal service, but we wish they had more choice and a higher credit rating.
We had a rough go trying to get a quote from American Family. It sure looked like it’d be easy to quote on the website, which has inviting buttons that say “Start Quoting.” We filled out a quote request form online with personal info, and then we were directed to email an agent. We had to wait three business days just to get a response. The agent who finally responded was kind enough and asked us to answer a few questions to get our quote. But then we waited two more days to get the premium price and see the coverage options. For such a large company, it felt like this shouldn’t be so hard.
We weren’t necessarily alone in our so-so experience: Of the five companies we surveyed for this review, Consumer Reports readers rated American Family the lowest in overall customer satisfaction (79, compared to 84 for Nationwide and 82 for State Farm). For what it’s worth, American Family offered more discount options than any company we tested. Any homeowner who has recently renovated their home, installed an impact-resistant roof, or wants to make upgrades to get LEED certified will see a discount on their annual bill from AmFam.
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Did You Know?
Flood insurance is separate from homeowners insurance.
With flooding, “History shows that if you’re in a flood zone, it’s not if you’ll flood, but when,” says a report by the Iowa Dept. of Natural Resources.
It bears repeating: the typical homeowners insurance policy does not cover flood damage. If you live in or near a flood zone, it’s all but essential to buy a separate flood insurance policy either through the government-run National Flood Insurance Program or through a private carrier.
However, this doesn’t mean your homeowners policy is useless in the event of water damage.
According to the San Francisco Gate, insurers define water damage as “damage caused by water that affects your house before it touches the ground.” In other words, if there’s a downpour and you can prove the damage came from above and not below, you’re covered.
In addition, many insurers (including Auto-Owners, State Farm, Nationwide, and Farm Bureau) offer an optional coverage for sewer or storm drain backup. This is separate from flood insurance, but sewer backup can happen after heavy rain. The Civil Engineering Research Foundation says that the number of backed up sewers is increasing at about three percent annually, as the pipelines connected to them ages beyond 30 years, says the Insurance Information Institute.
Lastly, if your home flooded and looters made out with any of your valuables, that theft is usually covered by an HO-3 policy, says the SF Gate.
In all, it’s best to check out Iowa’s latest flood maps to see if you’re at risk, and talk at length with your agent about what coverages might be right for you. “Relative to the cost of homeowners’ insurance, both of those prices are considered affordable, especially when you consider the thousands you could be paying if you have water damage,” State Farm rep Kip Diggs tells the Des Moines Register.
Got a lot of land or a pricey home? Consider umbrella insurance.
Over 85 percent of Iowa’s land is used for agriculture, and the state ranks second in the U.S. for total agricultural exports. That equates to about 88,000 farms in the state, and generally, many more large lots of land in Iowa.
Having a large plot of land may increase the chance that strangers will be on your property, especially if it’s located off a busy road. Needless to say, it’s difficult and maybe even impossible to monitor what is going on at your property at any given moment. More land increases the possibility that people could, say, slip and fall on a patch of ice. If someone gets hurt on your property, you could be liable for damages.
Each policy has a standard liability amount that will cover personal injuries—Farm Bureau offers up to $300,000 in damages for such an event. However, there’s a chance that the amount of money involved can go beyond your standard liability coverage amount.
To insure against this, and many other risks most homeowners insurance providers offer optional Personal Umbrella insurance. Umbrella insurance costs generally about $150–$300 extra, and it covers you beyond the amount of coverage quoted in your policy, generally up to $1 million, says the Insurance Information Institute.
Farmers have many different insurance options and liabilities that we don’t cover in this article, which is focused on homeowners. We recommend farmers speak to an independent insurance agent to assess options.
What’s with all these insurance companies having “Farm” in their name?
Ever wonder why so many insurance companies have the word “farm” in their name? It’s especially prevalent in the Midwest. It’s obvious on the surface but more interesting as you dig further: Many of these companies started out strictly as insuring farmers, but they built a reputation for good business and fairness, they expanded their services to cityfolk.
Farmers Insurance claims their founders, John C. Tyler and Thomas E. Leavey, “knew from personal experience that farmers and ranchers experienced fewer risks with their vehicles and were entitled to preferred rates.” So they started a company selling insurance to farmers door-to-door. State Farm has a similar story: Illinois farmer George Mecherle felt that insurers were charging farmers hiked-up auto insurance prices based on accident rates from city drivers. He
Others, like Farm Bureau, started as grassroots organizations to represent local farmers’ interests when agriculture was in its heyday. Their services grew to insure the loss of crops and liabilities on farms. Like State Farm and Farmers, Farm Bureau built up a reputation for fairness, and now insures farmers and non-farmers alike.
The Bottom Line
Our research shows that Auto Owners and State Farm will give you top-notch service that you can’t get elsewhere. However, that doesn’t mean either will quote you the best price. The only way to make sure you’re getting the most bang out of your buck is to get multiple quotes and compare them yourself — and you can use the tool below to do just that.
Find the best homeowners insurance in your area.
Get a quote by entering your ZIP code and start saving today.