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New Jersey Homeowners Insurance

Homeowners Insurance in New Jersey: Complete Consumer Guide

Do you own a home in New Jersey? Are you considering moving here? We have some fun facts for. For instance, many people wrongly assume that New York is the most densely populated state, but New Jersey wins with an average of over 1,000 people per square mile. Also, 90% of the population lives in an urban area. Unfortunately, New Jersey also ranks first for car theft, with more cars stolen in Newark than any other city. It also has the most diners and shopping malls in the world. Famously, Bruce Springsteen, Queen Latifa, Aaron Burr, Frank Sinatra and Jon Bon Jovi are from New Jersey. Of the 50 resort cities and towns in New Jersey, the most famous ones are Ashbury Park, Wildwood, Atlantic City, Seaside Heights and Cape May. A leading industrial state, it’s the largest chemical production state in the country. The Miss America pageant is always held in Atlantic City, where casino gambling became legal in 1977.

Types of Homeowners Insurance policies in New Jersey

There are several types of homeowners insurance policies, but the HO-3 form is the most commonly sold. Condo owners have a specific form. Below, we do not mention mobile homes and rental units.

HO-1 The “basic form” covers the 10 most common perils. Some insurers do not offer HO-1 forms.

HO-2 This “broad form” provides limited coverage, but more than the HO-1 basic form.

HO-3 This is the most commonly purchased type of home insurance. It offers coverage for named perils and personal property. Your insurer will pay to repair or replace belongings caused by covered perils, 16 of which are covered by this type of policy, including fire and smoke; lightning strikes; windstorm and hail; explosions; vandalism and malicious mischief; damage from an aircraft, car or vehicle; theft; falling objects; the weight of ice, snow or sleet; and water damage.

HO-6 This is for condominium units. This is usually “walls-in” coverage and may protect the unit’s walls, floors and ceilings against 16 perils. It also includes coverage for the condo owner’s belongings.

HO-8 This form is for older homes and covers 10 perils. It is paid on an actual cash value basis, so it’s the cost of the items minus depreciation.

What factors affect rates on homeowners insurance in New Jersey?

There are many factors that affect rates on homeowners insurance. These include location, construction type and materials, the condition of the home, your credit score and claims history and other factors like qualifying discounts, whether or not you have a swimming pool and more.

Top 5 disasters in the State of New Jersey

New Jersey federally declared Fire as the most disaster with 105 counts since 1953, followed by Severe Storms, Flood, Biological, and Tornado disasters. Fire or Lightning disaster is one of 16 perils covered in a standard HO-3 homeowners policy. Here are the top 5 federally declared disasters in the state of New Jersey:

Rank Declaration Title Disaster Number
1 Severe Storms 18
2 Hurricane 9
3 Flood 8
4 Snow 6
5 Fire 3

Source: Federal Emergency Management Agency (FEMA)

How much is homeowners insurance in New Jersey?

On average, New Jersey homeowners pay $1,052 a year on home insurance.

Source: The average cost of homeowners insurance by state, Business Insider.

Crime Rate: Is New Jersey a safe state?

2019 Crime in New Jersey Crime Number Crime Rate*
Property Crime 118,637 1,335.7
Burglary 16,399 184.6
Larceny-Theft 91,902 1,034.7

*Rate per 100,000 inhabitants

Safest Cities in New Jersey by Property Crime*

  • Sparta Township, NJ has a population of 18,532 with a Property Crime rate of 1.7 per 1k. The city average home value is approximately $377,000.
  • River Vale Township, NJ has a population of 10,063 with a Property Crime rate of 2 per 1k. The average home value there is about $617,924.
  • Chatham Township, NJ came in third as the safest city in the state of New Jersey and has a population of 10,219 with a Property Crime rate of 2.3 per 1k. Its home value averaged at about $836,318.
  • Clinton Township, NJ has a population of 12,801 with a Property Crime rate of 2.6 per 1k. Its average home value is $408,513.
  • Monroe Township, NJ has a population of 45,342 with a Property Crime rate of 2.6 per 1k. The city home value averaged $410,083.

*Based on FBI Uniform Crime Reporting 2019, some cities have been eliminated because of changes in the state/local agency's reporting practices and cities with populations under 10,000. Zillow’s State/Cities average home value for a single family home or a condo as of Sept. 2020.

Compare Home Insurance Rates in New Jersey

Top homeowners insurance companies in New Jersey

According to J.D. Power’s survey of home insurance companies in New Jersey, the following companies are the best.

The Hartford came in second with 896/1000 from J.D. Power, an A+ from AM Best and an A+ from BBB.

Farmers came in third with 893/1000 from J.D. Power, a B++ from AM Best and an A+ from BBB.

New Jersey Home Insurance FAQs

Will my insurance go up if I get a new roof?

If you get a new roof your insurance rate may go down. Roof maintenance is very important for homeowners because a faulty one may cause damage inside the home in the event of hail or any type of bad or extreme weather.

Is it better to have a high or low deductible for home insurance?

The answer to this depends on your financial situation. The higher you set your deductible, the less you pay each month. And hopefully, you’ll never file a claim. But keep in mind that you must pay that deductible before insurance begins to pay for repairs. If you think you’ll struggle to pay, let’s a $2,000 deductible, it may be a good idea to choose a lower one.

Should I show my contractor my insurance estimate?

You have the right to get an estimate from your contractor or to allow the insurance company to do the estimate. If you have a contractor you trust, speak with your insurance company and let them know first.

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