Average Cost of Home Insurance Rises 27% After a Fire

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

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

Aside from Mississippi and West Virginia, two other states experience rate increases averaging more than 40%. Home insurance premiums in Idaho go up by 41% on average after a fire, while blazes cause rates in Oregon — which experiences a high number of wildfires — to increase by 40% on average.

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

Do you need special fire insurance?

Home insurance policies typically cover damage caused by fires — wildfires or residential fires. Fire damage is even covered if a blaze is caused by an event not typically covered by a home insurance policy, like an earthquake.

Some homeowners or tenants may want to — or even have to — purchase a separate fire insurance policy in addition to their regular home or renters insurance coverage. Owners of homes with a history of claims or ones that aren't a primary residence may purchase a stand-alone fire policy to protect against damage. Additionally, owners of homes built in high-risk areas with frequent wildfires may be refused coverage by traditional insurance companies. These homeowners will instead have to purchase Fair Access to Insurance Requirements (FAIR) plans to receive insurance coverage.

Most residential fires are caused by heating sources used for cooking. Data shows that cooking fires, stoves, ovens and other fixed sources of heat were to blame for an average of 46% of the yearly fires between 2003 and 2019. Further, between 2014 and 2019, cooking sources were the cause of at least half of residential fires, with a high point of 52% in 2017.

Behind cooking were heat sources, such as chimneys and fireplaces. These sources were responsible for fires 12% of the time on average — ranging from a high point of 16% in 2003 to a low point of 9% in 2019. Heating sources were responsible for a yearly average of 5% of all damage related to residential fires in this period. These fires led to 2,970 deaths, or an average of 6% yearly of all residential fire-related deaths.

Injury figures from the NEISS revealed that 67,770 people received hospital care for injuries sustained from chimneys and fireplaces between 2011 and 2020. On average, that’s 6,777 people injured yearly. However, fewer required (or sought) hospital attention in 2020 than in 2011. In fact, the number of injuries caused by chimneys and fireplaces fell by 44% during this period, according to NEISS figures.