Average Cost of Home Insurance Rises 27% After a Fire

Residential fires can be costly and emotionally draining to recover from. LowCostInsurance analyzed homeowners insurance rates from homes before and after a fire that resulted in total property loss and discovered that fire damage resulted in higher insurance rates nationally — and in every state.

Residential fires have caused billions of dollars in damage to homes across the country, according to data from the United States Fire Administration spanning nearly two decades. Residential fires caused an average of $8.1 billion in damage per year from 2003 to 2019 — the most recent data available from the agency — for a total of $138 billion.

Insurance companies cover a portion of the costs of fire damage on behalf of their policyholders, but these costs result in higher prices. According to LowCostInsurance, the average cost of home insurance rises by 27% after a residential fire. Rates could rise by as much as 42 percent or as little as 6 percent, depending on the state.

Fire damage causes home insurance costs to rise in every state, with average increases of 40% or higher in 4 states

Following the destruction of an entire dwelling by fire, the annual cost of that home's insurance policy rises by an average of 27 percent across all states and the District of Columbia. However, depending on the state in which the fire occurred, losing a home to fire results in different insurance premium changes.

After a fire, home insurance costs in Florida rise by an average of 6%, the lowest of any state and the only one below 10%. Home insurance rates in Mississippi and West Virginia, on the other hand, increase by an average of 42 percent after a fire, making them the most expensive states to experience fire damage.

Rank

State

Average annual cost after fire

Difference

1

Mississippi

$2,236

42%

2

West Virginia

$1,673

42%

3

Idaho

$1,486

41%

4

Oregon

$1,674

40%

5

Pennsylvania

$1,251

39%

6

Michigan

$2,156

39%

7

Maine

$1,359

38%

8

Wisconsin

$1,539

37%

9

Missouri

$2,769

36%

10

Illinois

$1,836

35%

11

North Carolina

$1,897

35%

12

Nevada

$1,469

34%

13

Arizona

$1,844

34%

14

Virginia

$2,105

33%

15

Alaska

$1,725

33%

16

Kentucky

$2,618

33%

17

Ohio

$1,707

31%

18

Washington

$1,542

31%

19

District of Columbia

$3,548

30%

20

California

$2,299

30%

21

New Mexico

$1,966

29%

22

Kansas

$3,367

29%

23

Alabama

$2,353

29%

24

Indiana

$1,562

29%

25

Georgia

$2,250

29%

26

Connecticut

$2,069

28%

27

Maryland

$1,782

28%

28

New Hampshire

$1,687

27%

29

Rhode Island

$2,155

27%

30

North Dakota

$2,279

27%

31

Minnesota

$2,677

26%

32

Arkansas

$2,338

26%

33

Delaware

$977

25%

34

Utah

$1,419

25%

35

Nebraska

$3,044

25%

36

Wyoming

$1,861

24%

37

Massachusetts

$2,187

24%

38

Tennessee

$3,707

22%

39

South Dakota

$2,567

22%

40

Texas

$3,119

22%

41

New Jersey

$1,448

21%

42

Colorado

$4,097

21%

43

Vermont

$999

21%

44

Iowa

$1,734

21%

45

Oklahoma

$3,997

20%

46

Montana

$2,915

18%

47

South Carolina

$2,376

17%

48

New York

$1,732

15%

49

Louisiana

$2,022

15%

50

Hawaii

$1,210

11%

51

Florida

$2,094

6%

States are arranged by the percentage difference between the cost of home insurance before and after a fire. The percentages are rounded.

Aside from Mississippi and West Virginia, two other states have seen rate increases of more than 40%. After a fire, home insurance premiums in Idaho rise by 41 percent on average, while rates in Oregon, which has a high number of wildfires, rise by 40 percent on average.

Colorado is the most expensive state for home insurance after a fire, but fire damage results in a lower-than-average markup than the rest of the country. When a fire destroys a home in Colorado, the cost of homeowners insurance rises by an average of 21% — six percentage points less than the national average.

Do you need special fire insurance?

Fires, whether wildfires or residential fires, are typically covered by home insurance policies. Fire damage is even covered if the fire is caused by an event that is not typically covered by a home insurance policy, such as an earthquake.

Some homeowners or renters may want – or even need – to purchase a separate fire insurance policy in addition to their standard homeowners or renters insurance coverage. Owners of homes with a history of claims or those that aren't their primary residence can purchase a stand-alone fire policy to protect themselves from damage. Furthermore, traditional insurance companies may refuse coverage to owners of homes built in high-risk areas with frequent wildfires. To receive insurance coverage, these homeowners will instead need to purchase Fair Access to Insurance Requirements (FAIR) plans.

Residential fires have caused an average of $8.1 billion in yearly damage since 2003

According to the most recent data from the U.S. Fire Administration, residential fires caused an average of $8.1 billion in annual damage between 2003 and 2019. Residential fires caused $138 billion in property damage during this time period.

Residential fire damage did not fade during this time period. Rather, the cost of fire damage rose slightly from $7.9 billion in 2003 to $8.5 billion in 2005, reaching a high of $9.5 billion in 2008 before falling back to $7.9 billion in 2019. The amount of damage caused by residential fires in 2019 differed by less than a single percentage point from 2003.

There was never a year with fewer than 350,000 residential fires from 2003 to 2019. Every year, there were 375,059 house fires, for a total of 6.4 million. In 2019, the year with the fewest fires, there were still 354,400 blazes, representing a 7% decrease from the total (381,200) in 2003.

From 2003 to 2019, changes in the cost and number of residential fires were largely insignificant.

During this time, tens of thousands of people were killed in residential fires. According to statistics, 45,895 people were killed in residential fires between 2003 and 2019, an average of 2,700 per year.

Cooking sources have been responsible for an average of 46% of yearly residential fires since 2003, followed — though not closely — by heating equipment

The majority of residential fires are started by cooking-related heating sources. Data show that between 2003 and 2019, cooking fires, stoves, ovens, and other fixed sources of heat were responsible for an average of 46 percent of yearly fires. Furthermore, between 2014 and 2019, cooking sources were the cause of at least half of all residential fires, reaching a high of 52% in 2017.

Heat sources, such as chimneys and fireplaces, were used to power cooking. These sources were responsible for 12 percent of fires on average, ranging from a high of 16 percent in 2003 to a low of 9 percent in 2019. Heating sources were responsible for a yearly average of 5% of all residential fire damage during this time period. These fires resulted in 2,970 deaths, accounting for 6% of all residential fire-related deaths on a yearly basis.

National Chimney Safety Week runs from September 26 to October 2, 2021, and data shows that many people are injured each year in fires caused by chimneys and fireplaces.

According to NEISS injury data, 67,770 people were hospitalized between 2011 and 2020 for injuries caused by chimneys and fireplaces. On a yearly basis, that equates to 6,777 people injured. However, fewer people needed (or sought) hospital care in 2020 than in 2011. According to NEISS data, the number of injuries caused by chimneys and fireplaces decreased by 44% during this time period.

Methodology

LowCostInsurance examined data from the United States Fire Administration on residential fires from 2003 to 2019 — the most recent available. The number of heating fires was compared to the total number of fires during this time period by the researchers. The United States Fire Administration categorizes heating fires as those that begin in:

  • Flues
  • Fireplaces
  • Chimneys
  • Broilers or fuel burners
  • Central heating systems
  • Heating systems, both fixed and portable
  • Furnaces
  • Boilers
  • Water heaters

This study also makes use of NEISS injury data. The data, which spans 2011 to 2020, denotes injuries from sources that resulted in at least 1,200 hospitalizations per year. Among these sources are:

  • Fireplaces that burn wood or gas
  • Fireplaces with built-ins
  • Fireplaces powered by electricity
  • Chimneys made of brick, stone, or masonry
  • Chimneys, stovepipes, and flues made of metal
  • Unspecified fireplaces
  • Unspecified chimneys

Finally, LowCostInsurance used Quadrant Information Services to calculate the impact of fires on the cost of homeowners insurance. Researchers collected insurance rates for homes insured to the median value of a home in each state.

The insurance rate data used in LowCostInsurance analysis came from Quadrant Information Services. These rates were obtained publicly from insurer filings and should only be used for comparison purposes. Your own quotations may differ.