Securing home insurance in Chicago comes with its challenges, as the average premium now stands at $2,560 for $300,000 in dwelling coverage, according to Quadrant Information Services. This is more than the national average of $2,151. However, cheaper options for Chicago home insurance are available. Bankrate’s insurance editorial team evaluated the Windy City’s homeowners insurance landscape to identify carriers that offer competitive rates without compromising on coverage. Our review process, which includes analyzing average rates and third-party evaluations, highlights leading insurers such as USAA, Allstate, Travelers, State Farm and American Family as noteworthy options for residents seeking value and reliability.
Best cheap home insurance companies in Chicago
After reviewing dozens of carriers, the Bankrate insurance editorial team found five that offer some of the best home insurance in Chicago, Illinois. These providers stand out for below-average rates, generous discounts, broad coverage options, good J.D. Power customer satisfaction ratings and strong financial stability.
To help customers quickly evaluate carriers, we assigned each company a Bankrate Score out of five points, which takes into account the various rating factors above and others like digital tools and local agent availability.
| USAA | 4.7 | $874 | 881/1,000* |
| Allstate | 4.2 | $940 | 809/1,000 |
| State Farm | 4.2 | $1,139 | 829/1,000 |
| Travelers | 4.1 | $1,194 | 790/1,000 |
| American Family | 4.2 | $1,354 | 813/1,000 |
*USAA does not qualify for official ranking with J.D. Power due to eligibility restrictions
USAA
As one of our 2024 Bankrate Awards winners for Best Home Insurance Company Overall, USAA is known for offering exceptional customer service and affordable rates. The catch is that USAA only sells insurance to active duty and retired military personnel, as well as eligible family members. Nearly every policy comes with identity theft coverage, contents replacement cost coverage and military uniform coverage. USAA offers potential discounts for bundling, customer loyalty and safety features.
Learn more: USAA Insurance review
Allstate
Also named Best Home Insurance Company Overall in the 2024 Bankrate Awards, Allstate offers robust coverage options and extensive digital tools for mobile policy management. In addition to standard home insurance coverage types, homeowners may be able to build a more comprehensive policy with endorsements for water backup, business property, musical instruments, sports equipment and electronic data recovery. However, Allstate’s customer satisfaction score from J.D. Power is slightly below average, and its National Association of Insurance Commissioners (NAIC) Complaint Index stands above the industry baseline, indicating a higher number of complaints than expected for an insurer of its size — important considerations for customers seeking a balance between cheap rates and quality service.
Learn more: Allstate Insurance review
State Farm
State Farm is the largest home insurance provider in the country and may be a good choice for shoppers looking for low rates, diverse coverage options and strong customer service. The company scored above average in J.D. Power’s customer satisfaction study, in part due to its robust digital tools and local agency presence. Policyholders may appreciate the carrier’s Premier Service Program, which can help connect you with reputable contractors after a covered loss. Although State Farm does not have as many home discounts as some competitors, it does offer potential savings for bundling and weather-resistant roofs.
Learn more: State Farm Insurance review
Travelers
If you are looking for cheap home insurance in Chicago, IL, you may want to request a quote from Travelers. Like all the companies on our list, Travelers’ average rate for Chicago residents is far lower than the city average, and the carrier offers a handful of discounts to potentially lower your premium even further. Savings opportunities may include a bundling discount, a loss-free discount and an innovative discount for those who live in LEED-certified green homes. It also has a green home endorsement that would allow you to rebuild with environmentally safe materials after a covered loss. Travelers has one of the lowest customer satisfaction scores in J.D. Power’s home study, though, so potential customers may want to speak with existing policyholders about their customer service experience.
Learn more: Travelers Insurance review
American Family
Although American Family’s average home insurance premium isn’t the cheapest on our list, it is still less than the Chicago average. Endorsement options from the carrier include matching siding protection, hidden water damage coverage and equipment breakdown coverage. In terms of discounts, AmFam offers potential savings for customer loyalty, renovated homes and paid-in-full premiums. Homeowners whose parents carry a home or auto policy with AmFam may be interested in the carrier’s generational discount. Note that the company did fare slightly lower than average in the latest J.D. Power U.S. Home Insurance Study.
Learn more: American Family Insurance review
Home insurance coverage options in Chicago
Illinois homeowners are not required by law to have homeowners insurance. However, your mortgage lender may require you to purchase a policy to protect their financial stake in your property.
Even if you don’t have a mortgage, most insurance professionals recommend considering homeowners insurance. Without a robust policy, you might have to pay substantial out-of-pocket costs if your home is damaged or destroyed.
Here are some endorsements and additional standalone policies Chicago homeowners might consider:
- Flood insurance: Because Chicago is located on Lake Michigan, many homes in the city may be at risk of flooding. Standard home insurance policies do not include flood coverage, so you may want to consider a standalone policy through a private insurer or the National Flood Insurance Program.
- Scheduled personal property coverage: Homeowners insurance covers valuable items, but the coverage limits tend to be low. If you keep expensive items in your home, like collections, fine art, jewelry or electronics, purchasing scheduled personal property coverage may be a good idea.
- Identity theft coverage: The Insurance Information Institutes (Triple-I) reports that more than 442 million Americans were impacted by identity theft in 2022. Many home insurance companies sell identity theft and fraud coverage, which may pay for identity restoration services, like credit monitoring.
Home insurance discounts in Chicago
Many insurance companies in Chicago offer discounts, which may help you get a lower homeowners insurance premium. If you are looking for affordable home insurance in Chicago, you may want to look for providers that offer multiple discounts that you are eligible for.
Here are some common discounts that may help you get cheap home insurance in Chicago:
- Claims-free discount: Homeowners who have no prior insurance claims on their record within the last several years can usually qualify for a premium discount.
- Multi-policy discount: Multi-policy discounts, which usually involve purchasing a home and auto insurance policy from the same company, can be significant.
- Pay-in-full discount: If your annual premium is paid in one lump sum, many insurance companies will lower your rate.
- Security system discount: Homes with a security system usually have a lower risk of theft, which means you may get discounted homeowners insurance.
- New home discounts: If your home is a new build, you may be eligible for savings on your premium.
- Updated roof discounts: An updated roof is less likely to be the cause of costly claims, so your insurer may reward you with a discount when your roof is replaced or updated.
The amount you can save with discounts varies greatly from insurer to insurer. Many discounts are small— 5 or 10 percent off — but if you are able to qualify for more than one, the savings may add up. Bundling is typically one of the largest potential savings opportunities.
Frequently asked questions
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The best homeowners insurance company will be different for everyone. Each shopper is looking for something different in their home insurance company. Some people are willing to pay a little extra for top-notch customer service. Others may be on a tight budget, so affordability is their number one priority. Before requesting quotes, you may want to make a list of your priorities to use as a guide while you shop.
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The average cost of homeowners insurance in Chicago is $2,560 per year for a dwelling coverage amount of $300,000, according to data from Quadrant Information Services. This rate is higher compared to the Illinois state average of $2,079. It’s important to note that actual insurance costs can vary widely based on personal factors, such as your home’s specific location, its value and your claims history.
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As a general rule, most insurance professionals recommend you have enough dwelling insurance to cover your home’s rebuild value and enough personal property insurance to cover the value of your personal items, like clothing, furniture and appliances. Your liability coverage limit may be based on your personal assets, such as your income, savings and retirement accounts. When in doubt, you may find it helpful to consult with a licensed agent to determine if you have sufficient coverage.
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Flood insurance in Chicago could be necessary due to its proximity to Lake Michigan and the Chicago River. If your home is in close proximity to these bodies of water or is relatively low-lying, it may face an elevated risk of flooding. While not universally required, it’s advisable for homeowners to evaluate their specific vulnerability to water damage. Consulting with local insurance experts can offer insights tailored to Chicago’s unique geographical challenges. Additionally, inputting your address in FEMA’s Flood Map tool may allow you to see how at-risk your home could be for flooding.
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Bankrate utilizes Quadrant Information Services to analyze April 2024 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on married male and female homeowners with a clean claim history, good credit and the following coverage limits:
- Coverage A, Dwelling: $300,000
- Coverage B, Other Structures: $30,000
- Coverage C, Personal Property: $150,000
- Coverage D, Loss of Use: $60,000
- Coverage E, Liability: $500,000
- Coverage F, Medical Payments: $1,000
The homeowners also have a $1,000 deductible, a $500 hail deductible and a 2 percent hurricane deductible (or the next closest deductible amounts that are available) where separate deductibles apply.
These are sample rates and should be used for comparative purposes only. Your quotes will differ.
Bankrate Score
Our 2024 Bankrate Score considers variables our insurance editorial team determined impacts policyholders’ experiences with an insurance company. These rating factors include a robust assessment of each company’s product availability, financial strength ratings, online capabilities and customer and claims support accessibility. Each factor was added to a category, and these categories were weighted in a tiered approach to analyze how companies perform in key customer-impacting categories.
Each category was assigned a metric to determine performance, and the weighted sum adds up to a company’s total Bankrate Score — out of 5 points. Our scoring model provides a comprehensive view, indicating when companies excel across several key areas and highlighting where they fall short.
- Tier 1 (Cost & ratings): To determine how well auto and home insurance companies satisfy these priorities, average quoted premiums from Quadrant Information Services (if available), as well as any of the latest third-party agency ratings from J.D. Power, AM Best, Demotech and the NAIC, were analyzed.
- Tier 2 (Coverage & savings): We assessed companies’ coverage options and availability to help policyholders find a provider that balances cost with coverage. Additionally, we evaluated each company’s discount options listed on its website.
- Tier 3 (Support): To encompass the many ways a home insurance company can support policyholders, we analyzed avenues of customer accessibility along with community support. This analysis incorporated additional financial strength ratings from S&P and Moody’s and factored a company’s corporate sustainability efforts.
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