Colorado Home Insurance: Advice for Home Buyers and Owners

Monthly payments are the bedrock of homeownership affordability. The landscape of homeownership along the Front Range has shifted over the years: stable home prices, higher interest rates, and skyrocketing property taxes (however, we’re in the top five cheapest states for property taxes). But home insurance has rapidly climbed the list of the biggest obstacles for homeowners. 

Colorado home insurance premiums have surged about 100.8% between 2020 and 2025. The growing number of hailstorms and wildfires has become more common and can cost billions of dollars.  

Homeowners’ Insurance in Colorado 

• Average Cost: $4,605 to 4,920/year ($384-410/month) for an insurance policy with $500,000 in Dwelling Coverage (60% above the national average of $2,800 to $3,400/year). 

• The Front Range Median Home Value is much higher than Colorado’s average. So, most homeowners are paying 50-100% more for their Dwelling Coverage.

Adding to the complexity, insurers have decreased the number of Coloradans they cover. Why has our state experienced such significant shifts? Well, we do rank second for hail claims and fifth for the risk of wildfires in the U.S. And some companies have backed out of the state altogether. One newer solution is Colorado’s Fair Access to Insurance Requirements (FAIR) Plan. When standard insurance isn’t available, the plan provides limited coverage options for high-risk residential and commercial properties.

Home Buyers: Knowledge is Power

We know this is not happy news, but you must know what to expect so you can budget for costs like this. Your RE/MAX Alliance agent will provide you with a detailed list of Homeownership Expenses. Having a real estate expert who educates you on details like this minimizes any surprises, so you are confident throughout the home-buying process.

Read: Understanding the Cost of Closing on Your House

Homeowners: Are you underinsured?

Roughly two-thirds of the 1,200+ homeowners impacted by the 2021 Marshall Fire were underinsured. It is crucial to check with your insurance company about your coverage. You want your policy to fully support the cost of your home if you ever need to rebuild. 

To lower insurance expenses, consider making fire-preventative improvements:

• Installing Fireproof Siding and Fencing

• Upgrade Roof to Class A Fire Rating

• Screen Your Exterior Vents with 1/8-inch Metal Mesh

• Replace Windows with Tempered Glass (2+ panes)

Sources: CO Dept of Regulatory Agencies Division of Insurance, coloradosun.com, gazette.com, nerdwallet.com, csfs.colostate.edu, cbsnews.com