Mississippi homeowners insurance

Mississippi homeowners insurance guide

Almost 69% of the over 2.9 million people in Mississippi live in owner-occupied housing. An average home in the state is worth $133,000. A catastrophic loss can put any family in financial jeopardy. Purchasing Mississippi homeowners insurance protects against potentially devastating losses. VIU by HUB provides an easy way to compare the cost of insurance.

Mississippi home ownership risks

Hurricanes, floods and tornadoes are some of the biggest risks that Mississippi homeowners face. Between 2005 and 2020, the Federal Emergency Management Agency granted 29 disaster declarations to the state for severe storms, flooding, tornadoes and hurricanes.

Floods are most likely to occur between November and June when the Mississippi river peaks. Tropical cyclones tend to cause flooding in late summer and fall. Record snowmelt followed by heavy rainfall produced widespread flooding in 2011 that caused over $500 million in property damage.

Mississippi has experienced multiple catastrophic hurricanes, such as Hurricane Camille which caused more than $900 million in property damage in 1969, and Hurricane Katrina, which caused billions of dollars in damage in 2005. Tornadoes also pose a significant threat, with an average of 46 affecting the state every year.

Mississippi homeowners insurance coverages

Homeowners insurance is a package policy that includes coverage for several types of loss. While the types of perils insured and level of coverage may vary by policy, most policies share similar components.

Dwelling Coverage

The Dwelling portion of your policy pays to repair or rebuild your home when a covered cause of loss, such as fire or wind, damages it. The most comprehensive homeowners policies cover all causes of loss that are not specifically excluded; however, some more basic forms only cover the perils specifically named in the policy.

Replacement Cost versus Actual Cash Value

The broadest policies cover the structures on your property at Replacement Cost, which is the actual cost to repair, rebuild or replace your property. Some policies may require you to purchase coverage that is 80% or more of the replacement value of your home to qualify for replacement cost payments.

A policy issued on an Actual Cash Value basis means the dwelling loss will be paid out on the replacement value, less depreciation. In this type of policy, the loss payment will be less than the cost to fully replace the dwelling.

Contents are typically covered at Actual Cash Value, which is the replacement cost less a deprecation deduction that depends on the age and useful life of your property. You may be able to purchase an endorsement to cover your contents at replacement value for an additional cost.

Other Structures

The Other Structures portion of your policy pays to repair or replace structures on your property that are not your home. Examples of other structures include fences, sheds and garages.

Contents

The Contents portion of your policy pays to repair or replace your personal property, such as furniture, clothing and electronics. However, your policy may exclude or limit coverage for some types of property, such as jewelry, artwork, guns, cash and automobiles. You may be able to purchase additional coverage for some types of property by endorsement.

Additional Living Expenses

The Additional Living Expenses portion of your policy pays for temporary extra costs you incur because of a covered cause of loss. For example, it may pay for you to rent a hotel room or apartment while you are unable to live in your damaged home.

Liability

The Liability portion of your policy covers your legal obligation to others due to property damage or injuries that you or a family member cause. However, some types of liability, such as the operation of a motor vehicle or a home business, are usually excluded.

Medical Payments

The Medical Payments portion of your policy provides a small amount of coverage for injuries to non-household members on your property. You can use this coverage even if the guest unintentionally caused their own injury.

Windstorm Coverage

Because of the high risk of hurricane damage, some insurance companies may exclude or limit coverage for wind damage in the coastal parts of Mississippi. If your homeowners policy does not cover windstorm damage, you may be able to purchase Windstorm Coverage as an add-on coverage.

Flood Insurance

Flooding is a significant risk in many parts of Mississippi; however, homeowners insurance usually does not cover this risk. You may be able to purchase a Flood Insurance policy from an insurance company or from the National Flood Insurance Program.

Average cost of Mississippi homeowners insurance

Mississippi homeowners pay an average of $375 a month for homeowners insurance, which is higher than the national average of $210. Mississippi residents can save money on their premiums by comparing rates from different companies on the coverage they need with VIU by HUB.

Factors that affect Mississippi homeowners insurance rates

Multiple factors can affect how much you pay for homeowners insurance in Mississippi.

Policy form

Homeowners policies come in several types called forms. HO-5 is the most comprehensive and covers the widest range of property perils. The primary difference between these forms is the causes of loss they provide coverage for.

Coverage levels

The more coverage you purchase, the more your insurance company may have to pay out in claims. Choosing a higher limit will usually increase your premiums, but not fully insuring the value of your home can result in  not having enough money to repair or replace it if you suffer a large loss.

Deductibles

Your deductible is the amount you must pay to repair or replace your property before your insurance pays anything. Choosing a higher deductible reduces the risk for the insurance company and usually results in a lower premium. However, if you have a loss, you will have to pay more out-of-pocket.

Location 

Homes in Mississippi's coastal areas typically cost more to insure because of the risk of damage from tropical storms and hurricanes. Additionally, homes in areas with high crime rates and other types of severe weather also have higher average premiums.

This information is intended for general informational purposes only and is not intended to constitute legal advice.

Sources:

Census.gov

Mississippi Windstorm Underwriting Association

Centers for Environmental Information

Mississippi Insurance Department