Colorado Homeowners Insurance Guide
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Colorado Homeowners Insurance
Explore Colorado Homeowners Insurance State Guides, Laws and Regulations before You Buy Insurance
The Centennial State is home to an unbelievable landscape. Although many visitors, and Coloradans enjoy the majestic ranges of the Rocky Mountains, or the desert of the Colorado Plateau, the state still affords a taste of the city through metropolitan centers such as Denver. With terrain over a mile above sea level, its no wonder Coloradans tend to enjoy skiing. In fact, the Centennial State is generally known to attract those looking to embrace the outdoors and enjoy basking in its abundant beauty. Unfortunately, the downside to this natural beauty, is that it can often cause weather-related disasters. Colorado is known for suffering from severe storms, in particular hailstorms, as well as wildfires. Both have caused quite a bit of damage in the Centennial State.
These are by no means the only perils homeowners and renters in the state need to be aware of. As you could imagine, the accumulation of snow and uneven terrain makes some areas within the state susceptible to flood also.
What Does Homeowners and Renters Insurance Cover, and How Much Does it Cost?
Coloradans pay a significant premium for homeowners insurance compared to the rest of the country, while their renters insurance rates are a bit better than average. This undoubtedly is driven by the state’s susceptibility to catastrophic losses from disasters such as hailstorms or wildfires. Although these perils do impact renters alike, they disproportionately impact property owners, given they own the physical buildings that are being rented out.
Average Homeowners and Renters Insurance Premium
| State | Homeowners | Renters |
| Colorado | $1,495 | $159 |
| USA | $1,211 | $180 |
Source: Insurance Information Institute (2017)
Albeit property owners in the Centennial State pay significantly more than the rest of the country for homeowners insurance, their risks are typically covered under a standard policy. In addition to the normal perils of fire, theft, vandalism and others; the standard homeowners policy also covers loss resulting from hail and wildfires. That said, if your property is located in a flood zone or near a dam or river, you can obtain flood insurance in the surplus market or from the National Flood Insurance Program (NFIP).
Which Property Insurance Carrier Should I Choose?
Given the risky nature of property located in Colorado, the market is relatively concentrated with the top five insurance carriers controlling over 60% of the market. In fact, the top carrier controls almost one-fifth of the entire market. The financial risk of enduring a large loss stifles competition among carriers as many opt to not extend themselves, and limit the amount of property they insure in the region. As a result, Coloradans are charged relatively high rates to cover their property assets.
Top 5 Home Insurance Carriers in Colorado
| Company | Market Share |
| State Farm | 19.5% |
| USAA Insurance Group | 11.6% |
| Liberty Mutual | 11.0% |
| Allstate Corp. | 9.6% |
| American Family Insurance Group | 9.6% |
Source: Insurance Information Institute (2019)
Unfortunately, the lack of competition in the market is understandable given Colorado’s history of suffering catastrophic property losses. Below are a few of Colorado’s most costly catastrophes in order of cost.
Rocky Mountain Region Catastrophes
| Date | Peril and Location | Size of Loss |
| May 8, 2017 | Hail – Denver | $2.4 billion |
| July 1990 | Hail – Colorado | $1.2 billion |
| July 20, 2009 | Hail and Wind – Denver | $914 million |
| June 2012 | Wildfire – Colorado Springs | $505 million |
| June 2013 | Wildfire – Black Forest | $461 million |
Source: Rocky Mountain Insurance Information Association (RMIIA)
Coloradans pay a significant premium for homeowners insurance when compared to the rest of the country. However, the Centennial State provides a one of a kind landscape that property owners within the state get to enjoy every day. Such a trade off seems to be well worth it.
Colorado Regulating Agencies And References
