Best Homeowners Insurance in Hawaii: Top 5 Insurance Companies to Protect Your Investment

When you have a rental property in the Aloha State, you know you're boosting your real estate investment portfolio. However, you won't be dealing with trips to the beach and beautiful, sunny days. In fact, you'll navigate the risks of being a property manager or landlord. There could be horrendous thunderstorms, tropical storms, and even full-on hurricanes during the summer months.

You must focus on protecting your investment, but how? The easiest way to do that is through a homeowners insurance policy.

Is homeowners insurance in Hawaii required? Generally, no. However, your mortgage lender might make you hold a policy.

There are many options available for home insurance in Hawaii. Therefore, it's hard to determine the best choice with reasonable insurance coverage and premiums. That's why we made this guide!

We researched the best homeowners insurance companies available to help you search for an appropriate homeowners policy. This guide includes tips for choosing your options because Hawaii is full of unique hazards other states don't deal with.

Likewise, we analyzed the information and put it all together in a helpful guide. We used data from Quadrant Information Services to help you find the best home insurance companies with affordable rates, generous discounts, multiple coverage options, and more.

Understanding Hawaii Homeowners Insurance

Property managers and landlords need to have a clear understanding of what homeowners insurance pays when there's a problem. This is crucial coverage that will be your safety net against unexpected challenges and difficulties.

Average Home Insurance Costs in Hawaii

The average rate for homeowners insurance in Hawaii is about $382/year when you have dwelling coverage of $250,000. This is much less than your national average, which is $1,428/year for similar coverage.

Typically, the low rates for an insurance policy in Hawaii might be related to exclusions for windstorm damage. Most companies don't offer this as part of the basic package. Hurricanes are prominent natural disasters in this area, and property managers and landlords will have to buy standalone coverage.

Likewise, the price you'll pay is based on many factors, such as:

• Age of the home
• The type of structure(s)
• Cost to rebuild the home
• Claims history for the house
• Materials used in the home
• Your location
• Fire rating in the home's location
• Your preferred deductible
• Your coverage limits and amount
• Your credit score

It might be possible to save money through discounts when you bundle various insurance types from the same company.

Homeowners Insurance vs. Landlord Insurance

Homeowners insurance primarily focuses on the home's structure and any personal belongings within. This may not be comprehensive when you're renting properties out.

Landlord insurance is different because it's specialized to meet the needs of landlords and property managers. There's more protection against the loss of rental income, liability from accidents, and more.

You are allowed to get a homeowners insurance policy in Hawaii as a landlord. However, you must discuss this with the insurer and avoid misrepresenting the use of the property. Otherwise, you could run into trouble, such as policy cancellation or denied claims.

When will you want homeowners insurance and not landlord insurance? Here are some scenarios:

Temporary Absence

If you're planning to move because of work, you might temporarily rent the property for a short time. Homeowners insurance can be beneficial, but you must ensure you have the best coverage while you're away. Likewise, landlord insurance is generally best if you're choosing to rent it out long-term.

Vacant Property

If your rental is sitting vacant right now, you can get homeowners insurance. The coverage protects the structure and anything within. However, some policies have no-vacancy clauses, so be careful about this.

Home Sharing

If you rent out one bedroom of your home to another person, you might choose a company with a home-sharing policy option. However, coverages can vary, so you should read through the policy carefully.

Likewise, you might need more liability coverage to handle accidents involving tenants and guests. Remember that homeowners insurance won't cover the income loss after a covered event. Therefore, you may wish to supplement it with landlord insurance.

Transition Period

Acquiring a new property often means doing work on it. You may not be able to rent it right away, and you should keep homeowners insurance on it until you can get a tenant in the residence.

How to Choose a Hawaii Homeowners Insurance Company

Now that you know when to get homeowners insurance, it's important to choose the right company and policy. Here's what home insurance typically covers:

• Personal Belongings - This reimburses you for replacement and repair costs of damaged items, including electronics, appliances, clothing, and furniture.
• Dwelling Coverage - This will pay to replace or repair damage to your home's structure. It often includes any related structures, such as a swing set, storage building, or detached garage.
• Loss of Use - Often called ALE (Alternative Living Expenses), this reimburses you for any costs from restaurant meals, hotel rooms, and more.
• Liability - If someone gets hurt on the property or they damage their own items, they could sue you. This coverage will offer financial protection.

Unique Policy Needs for Hawaii Homeowners Insurance

Your home insurance company will likely offer additional coverage for certain events, such as floods and earthquakes. Let's learn more about them now:

Flood Insurance

A standard home insurance policy generally covers any weather-related problems from wind and hail, but it might not cover flooding damage. Therefore, you'll need a separate policy or an endorsement for these events.

Some private insurers do sell flood insurance, but it's usually offered through a qualified insurer, such as the NFIP (National Flood Insurance Program.) Since the property is in Hawaii, it's close to the ocean. Therefore, it's wise to talk to your insurance agent about flood insurance.

Earthquake Insurance

Hawaii is also prone to earthquakes. While the damages might be covered under other aspects of the policy, most of them will exclude earthquakes. Therefore, you will need a rider, endorsement, or a separate policy for this.

Volcanoes

There are 15 volcanoes in Hawaii. Though you don't expect them to become active, you never know when it might occur. Check your policy to see if it covers volcano damage. If not, you may consider buying a separate homeowners policy for that.

Fires

Wildfires are possible in Hawaii, and August 2023 saw a series of them break out, primarily in Maui. This led to evacuations and caused significant damage. Therefore, you should check to ensure your home insurance offers protection from fires. It's also wise to make sure that it specifically covers wildfires, as many companies don't.

Hurricane Damage

Since Hawaii is in the Pacific Ocean, it sees about five tropical storms/cyclones every year. Most homeowners insurance policies won't cover hurricane damage because it's a natural disaster. Therefore, it's wise to read your policy details or ask an insurance agent if you're covered or how to get covered.

Other Factors to Consider When Assessing Hawaii Homeowners Insurance Companies

When choosing a home insurance company, it's wise to follow these steps:

1. Determine what you require.
2. Research companies and read reviews from other customers. Check each brand's financial strength.
3. Compare the coverage options.
4. Consider the price you'll pay.
5. Evaluate the financial strength of each company by checking independent rating agencies like A.M. Best.
6. Make sure the brand offers excellent customer service.
7. Ask about discounts.
8. Get recommendations from others.
9. Review your policy and check for discrepancies or problems.

Best Home Insurance Companies in Hawaii

It's time to check out each Hawaii homeowners insurance company below. There are five top choices!

1. Progressive

Along with traditional homeowners insurance coverage, Progressive provides optional add-ons to pay for personal injury lawsuits and water backup damages.

Likewise, Progressive sells home insurance policies from other insurers, so you'll get the best deal possible.

Coverage and Features

Progressive offers these types of coverages in the standard plan:

• Dwelling Coverage - Pays for covered losses resulting in damage to the house and attached structures (sunrooms/garages).
• Other Structures - Protects the detached structures on the property, such as patios, fences, and driveways.
• Personal Property - If any personal belongings are damaged or stolen because of a covered loss, Progressive will replace them up to the coverage limits.
• Medical Payments Coverage - If a visitor or guest gets hurt on the property or by another person's activities, the insurance might cover medical expenses up to your policy limit.
• Personal Liability - If a visitor gets hurt or has property damaged because of another person's negligence, they might sue. This will pay for legal costs.
• Loss of Use - This covers expenses up to the policy limit when the home is damaged and uninhabitable while being repaired. It generally covers meals and housing.

Discounts

You can find discounts from Progressive when you pay your premium in advance. Likewise, you could save money by agreeing to emailed documents and multipolicy bundling of auto insurance and more.

2. Allstate

Along with the standard home insurance, Allstate provides optional coverage to thoroughly protect your belongings and home. It's a great choice when you want something comprehensive.

Coverage and Features

The standard home insurance policy provides these benefits:

• Dwelling coverage
• Guest medical protection
• Liability protection
• Personal property coverage

There are also extra insurance coverages available, such as:

• Green improvement reimbursements
• Musical instruments
• Electronic data recovery
• Yard and garden
• Sports equipment
• Business property
• Scheduled personal property
• Water backup
• Identity theft restoration
• HostAdvantage
• Flood insurance
• Personal umbrella policy

Discounts

It's possible to get discounts on insurance coverage through Allstate. These options are available:

• Responsible payment discount
• Home buyer discount
• Welcome/loyalty discounts
• Early signing discount
• Protective device discount
• Claim-free discount
• Easy pay plan
• Multipolicy discount

3. State Farm

With State Farm home insurance, you have many coverage options. Some expand the coverage to things not found in its standard policy, including damage to service lines and water backups.

Coverage and Features

With an insurance policy from State Farm, you'll get these coverage options:

• Dwelling
• Personal property
• Other structures
• Medical payments
• Personal liability
• ALE (Additional Living Expenses)

There are other insurance coverages available, such as:

• Valuable possessions
• Inflation guard
• Identity restoration coverage
• Ordinance or law coverage
• CEIDR (Cyber Event, Identity Restoration, Fraud Loss)

Discounts

Discounts are available through State Farm and include:

• Utilities rating plan
• Claims-free discount
• Automatic sprinkler discount
• Home security discount
• Multipolicy (bundling home and auto insurance)
• Roofing

4. Chubb

Chubb offers standard home insurance, including dwelling and liability coverage. However, you can also get a cash settlement after a total covered loss. Likewise, it's possible to expand the replacement cost coverage to be protected in case your policy limits aren't enough.

Coverage and Features

The Masterpiece Homeowners Insurance Policy from Chubb includes home and personal property coverage. You'll be protected from smoke, theft, fire, bad weather, vandalism, and more.

However, you can separately purchase policies for valuables, floods, and earthquakes.

Discounts

There are various discounts available from Chubb, including:

• Multipolicy discount
• Backup generator discount
• New/renovated home discount
• Claims-free discount
• Fire/security discounts

5. Liberty Mutual

Liberty Mutual offers standard home insurance for hail and wind damage and specifically covers hurricane damage. Likewise, it provides inflation protection, which is optional, and automatically adjusts coverage limits as the policy renews.

Coverage and Features

Typical policies cover:

• Personal property
• ALE (additional living expenses)
• Guest medical coverage/liability
• Dwellings and other structures

Additional coverages include:

• Inflation protection, which adjusts coverage limits whenever you renew a policy
• Replacement cost of belongings, which pays the actual cash value of the items when the loss occurred
• Hurricane coverage
• Earthquake coverage
• Flood coverage

Discounts

The discounts available through Liberty Mutual include:

• Claims-free discount
• Multipolicy discount
• Safe homeowner program
• Newly purchased home
• Paperless policy discount
• New roof discount
• Many others

Other Notable Hawaii Home Insurance Companies

Though the companies above offer the best homeowners insurance options, here are a few others to consider:

• AIG Property Casualty Co.
• Ocean Harbor
• American Family Insurance
• USAA (only available to the military and their family members)
• Agilerrates
• Hippo
• Farmers Insurance

Conclusion

The Aloha State has everything a person could want, but when you're renting properties, you require the best homeowners insurance in Hawaii.

It's not wise to go with cheap home insurance because it might not cover everything. Therefore, it's best to explore your options, assess the risks, and seek insurers with financial strength and a proven track record.