September 2, 2025
Indiana home insurance averages $2,384 annually, slightly below the national average, but rising 40% in six years due to severe storms, hail, and flood risks.
Indiana's homeowners insurance market presents a complex landscape shaped by severe weather risks, competitive pricing, and evolving regulations. The average cost of homeowners insurance in Indiana is $2,384 annually, which falls slightly below the national average of $2,423. However, home insurance prices have jumped 40.4% in Indiana over the last six years, reflecting broader industry trends affecting the Midwest.
Despite being positioned favorably compared to coastal states, Indiana homeowners face unique challenges. The average annual cost of home insurance in Indiana is $2,495 according to some recent analyses, though rates vary significantly by provider and coverage level.
Indiana's geographic location places it at the crossroads of multiple weather systems, creating substantial exposure to various natural disasters. According to the National Weather Service, Indiana averages 22 tornadoes each year, making tornado coverage a critical consideration for homeowners.
According to the National Centers for Environmental Information, Indiana saw 64 reported floods in 2024, highlighting the state's significant flood risk. This is particularly concerning given that $281 million of FEMA flood insurance claims have been paid in Indiana since 1980, yet only 15,781 insurance policies are in effect as of 2025, per FEMA - covering less than 1% of the state's 2.5 million households.
A significant part of the state is considered at very high or relatively high risk of hail damage, according to FEMA. The state also experiences frequent water damage from summer storms, heavy snows, and water backup issues - making sump pump and water backup endorsements essential considerations for Indiana homeowners.
Premium costs vary significantly across Indiana's cities. In Evansville, homeowners pay about $2,545 annually, while Fort Wayne residents see lower rates at around $2,179. Indianapolis has the highest at approximately $2,722.
Credit scores dramatically affect premiums in Indiana. Homeowners in Indiana with excellent credit pay an average annual premium of $1,417 for homeowners insurance, while those with poor credit face a steep increase, averaging $5,847 - a difference of $4,430 between the highest and lowest credit ratings. While actual premiums depend on individual underwriting factors, credit score is one key determinant across many insurers.
Premium variations also depend heavily on coverage amounts. In Indiana, a basic policy with $100K in dwelling coverage costs an annual premium of $1,423. If your home is larger and you need $500K in dwelling coverage, the premium increases to $3,794.
Several insurers compete effectively in the Indiana market:
Highly-Rated Companies:
Low-Cost Options:
According to the Indiana Department of Insurance, from 2009 to 2021, 21% of all homeowner complaints have been filed against State Farm, indicating potential service issues despite the company's market presence.
Indiana operates without a state FAIR plan, meaning homeowners who cannot secure coverage in the private market must seek alternatives through surplus lines carriers. Homeowners unable to secure insurance in the private market can apply to the Indiana FAIR plan. You must have been denied coverage by at least three non-related insurance companies to apply to the FAIR plan.
Indiana maintains specific cancellation regulations:
Given Indiana's weather patterns, several endorsements prove critical:
Many carriers enforce coverage restrictions or actual cash value settlements for roofs over 15-20 years old, making roof maintenance and replacement timing crucial for coverage adequacy.
Indiana homeowners must disclose wood stoves, pools, trampolines, and certain dog breeds, as these may require additional safety measures or affect liability coverage.
As insurance claims have increased due to stronger, more frequent storms, Indiana customers are feeling price increases. Indiana homeowners have seen significant increases in home insurance prices recently, with rates up 12.3% in 2023 and 13.0% in 2024.
According to the National Centers for Environmental Information, Indiana experienced eight natural disasters in 2024 totaling $1 billion in losses, demonstrating the increasing financial impact of severe weather events.
For mortgage servicers and financial institutions working with Indiana homeowners, partnering with specialized insurance services can help improve customer satisfaction while potentially reducing operational costs. Covered's warm transfer services connect customers with licensed agents who can help them explore coverage options tailored to Indiana's unique risks. These partnerships aim to help customers make informed insurance decisions and better manage their potential risk exposure, particularly regarding essential endorsements like sump pump coverage and flood insurance.
Indiana's insurance costs compare favorably to several neighboring states, though the differences are narrowing due to regional weather patterns affecting the entire Midwest.
Indiana home insurance rates are also cheaper than some neighboring states. For example, the average home insurance premium in Kentucky is $3,643, and the average rate in Illinois is $2,174.
Indiana's homeowners insurance market reflects the state's position at the intersection of multiple weather systems and economic pressures. While rates remain below the national average, the 40% increase over six years signals ongoing challenges. Success in this market requires understanding local risk factors, maintaining good credit, and working with knowledgeable insurance partners who understand Indiana's unique coverage needs.
The combination of severe weather risks, competitive pricing, and evolving regulations makes Indiana a dynamic market where informed decision-making and professional guidance prove invaluable for homeowners seeking adequate protection at reasonable costs.
This article provides general information about Indiana’s homeowners insurance market based on available industry data as of 2025. Individual circumstances vary significantly, and premium quotes, coverage options, and policy terms differ by insurance company. Consumers should consult with licensed insurance professionals for specific coverage recommendations and current pricing. Information presented should not be considered as guaranteed outcomes or personalized insurance advice.
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*Savings claim based upon averaging actual anonymized savings data for dwelling-only insurance rates paid (from July 2023 - June 2024) by customers of two of Covered’s largest mortgage industry partners across twenty-seven (27) US states. Bundles and non-dwelling insurance coverages were excluded.
† Net Promoter Score (“NPS”)® calculation averages post-purchase customer satisfaction surveys from 9/24/2024 - 2/28/2025. NPS® is a market research metric measuring customer satisfaction with a scoring calculation that incorporates both detractor and promoter customer feedback.
Quotes are presented solely for your convenience. Savings may vary. Rates are subject to change based upon the specific coverage you select and other factors that apply to your situation. CA License #0M81402, doing business as Cubbard Insurance Solutions in California.
