One of your top priorities when investing in real estate should be getting insurance. Even though Illinois is considered a state with a medium risk for natural disasters, your future property could still be exposed to many dangers.

Home insurance is the best way to protect your property and personal belongings against any unexpected circumstances. Investing in a property isn't cheap, so you should take every measure possible to protect it.

Thankfully, there are several home insurance companies to check out. Each insurance company has unique features and discounts, but all of them offer the same goal: protecting your property.

Which insurance company should you go for, then? This can be a tough question to answer since everything depends on your needs. If you want to understand how homeowners insurance in Illinois works, you've come to the right place.

We'll walk you through the basics of home insurance on this page. If you're interested in homeowners insurance in Illinois, we also created a list of the top five companies you can consider today.

About Illinois Homeowners Insurance

Homeowners insurance is a type of coverage for your property. Once you get an insurance policy for your new home in Illinois, you'll be protected from many events that could harm your space or your belongings.

Depending on the policy you get, you could get coverage to repair or replace your personal property.

Even though many people get homeowners insurance to protect themselves from extreme weather events like hail or heavy rain, these policies also cover damage caused by:

• Vandalism
• Theft
• Smoke
• Fire

An interesting fact about homeowners insurance is that most companies also offer protection from liability claims against you. If someone suffers an injury at your home, your insurance could cover the legal expenses or medical bills. It all depends on the policy you get.

Average Illinois Homeowners Insurance Costs

How high is the average annual premium in Illinois? According to Bankrate, the average is $1,410 per year for up to $250k in coverage. This translates to $117 a month.

The average annual premium in Illinois is in line with the national average, which is $1,428 per year. What this means for you is that you'll be able to find homeowners insurance policies at excellent prices if you know where to look.

Sometimes, homeowners don't get insurance because of the added expense, so this is excellent news for them. Even if the average cost was higher, it's always recommended to get homeowners insurance. You never know what could damage your property.

Most of the time, the cost of the damages caused to your property will be higher than what you're paying monthly or annually for insurance. Remember that the extra expense of your investment is meant to protect it.

Illinois experiences different extreme weather conditions from time to time. These conditions include intense storms and hail. Still, remember that your quote will depend on different factors, including where you live, the condition of your property, and more.

Chicago, for example, has the highest average premiums compared to the rest of the state. If you're looking for a property there, you can expect to spend a bit more money on insurance.

What Affects Home Insurance Coverage in Illinois?

As mentioned, the coverage of your Illinois home insurance will depend on different factors. If you know where to look, you could find a company with great prices and discounts, allowing you to save money in the long run.

What are the factors that affect your homeowners insurance? Here's a list:

• City
• Location of the Property
• Age and Condition of the Property
• Features, Type, and Value of the Property
• Roofing Condition
• Deductibles
• Discounts
• Past Claims History
• Current Credit History
• Add-ons

Something that many people do to lower their insurance premiums is to bundle their policy with another one. Many companies offer both home and auto insurance, for example. If you sign up for both policies, the company may consider giving you a discount.

As for the add-ons, they depend on the company. Some providers, for example, have a partnership with the National Flood Insurance Program, so they offer separate coverage for flooding events. Your homeowners policy could also have extra protection from mine subsidence, water backup damage, etc.

We recommend you evaluate all the options we'll give you on this page and compare them. You can also talk to an insurance agent from the companies you liked the most to get more information. This way, you'll make a more informed decision based on what you need for your new investment in Illinois.

Is Homeowners Insurance Required by Law?

Homeowners insurance isn't required by state or federal law. However, there are a few "exceptions."

If you have a mortgage or equity loan, for example, you may get asked to get insurance. Lenders have permission to ask their clients to get insurance, so many of them include that in the requirements for giving you money.

In other words, homeowners insurance isn't legally required, but it's often required by lenders. Homeowners insurance generally is an excellent thing to consider even if you're not getting financing for your property.

The Difference Between Home Insurance and Landlord Insurance | Which One Do You Need?

A common dilemma people come across when investing in a property is whether they should get homeowners insurance or landlord insurance. Even though the answer may be obvious to some, the similarities between both options could confuse people.

About Landlord Insurance

Homeowners insurance and landlord insurance are designed to protect you from events surrounding your property. The main element that changes is the type of protection you're getting.

Landlord insurance focuses on protecting you, not the property. If you're investing in Illinois real estate to rent, you'll need protection in case your tenants cause damage to your property. Landlord insurance often offers personal liability coverage too, meaning you won't have to worry about paying for legal expenses or medical bills if your tenant sues.

How does landlord insurance protect you? Generally speaking, it protects you from loss-of-rent damage. In other words, it covers you if certain events cause you to miss out on full rent payments. Landlord insurance is recommended if you're not planning on living on the property or want to rent constantly to other people.

About Home Insurance

As we mentioned earlier, home insurance places the focus on protecting your property instead of you. You can only get homeowners insurance in Illinois if you're living at the property.

If your home gets affected by any covered peril, you could get money to cover repairs or replacements. Additionally, your insurance policy could give you money to cover lodging, meals, or any other loss-of-use expenses. You may get these expenses if a natural disaster forces you to move out of the property while it gets repaired, for example.

Homeowners insurance won't protect a tenant and their belongings, which is why people planning to rent often prefer getting landlord insurance.

If you're planning on living at the property and renting a small space in it, homeowners insurance would be the most appropriate option to get. You can add a few extra clauses to your rental agreement if you want to protect yourself from any tenant damage.

What Should Your Home Insurance Policy in Illinois Have?

Your policy should cover at least the basics:

• Dwelling and Other Detached Structures
• Loss of Use
• Personal Property
• Medical Protection
• Liability Coverage

Thankfully, Illinois isn't as likely to experience natural disasters as other states in the U.S. This means you can save a bit of money in the process.

However, if you plan on investing in a "risky" zone, you may want to get some add-ons to cover potential damages. These add-ons include:

• Flood Insurance
• Tornado/Hail Insurance
• Blanket Jewelry
• Personal Electronics Coverage
• Escape of Water

Feel free to ask your home insurance agent for guidance. They can give you more information about what type of insurance will suit your needs the best based on where the property is located.

What Are the Most Common Causes of Insurance Claims in Illinois?

The most common claims in Illinois depend on the area. You can expect tornado/storm damage claims to be more common than others.

Illinois is known for averaging 50-54 tornadoes per year. If the storm is severe enough, it could leave your home inhabitable. On the other hand, heavy storms can knock trees onto your roof or cause your pipes to burst. These "perils" are often covered by home insurance policies in the state.

Even if your home isn't exposed to these perils as much, you should still consider getting Illinois homeowners insurance. You never know what could damage your property, and it's always better to have protection available just in case.

How to Find the Best Homeowners Insurance in Illinois

There are dozens of home insurance companies in Illinois. How can you find the right one?

The process is complicated for some because the decision doesn't depend 100% on the price. You must consider your needs, goals, and other factors to get the right option.

Even if your favorite home insurance company charges too much for its premiums, remember that it could offer plenty of attractive discounts that can bring the premium down.

However, your decision should be focused on how well you'll get covered. If you feel like you only need the basics, then all of the companies we'll mention here will work. Otherwise, you may want to take a closer look.

Here are some tips to follow if you want to get the best coverage option for your property in Illinois:

Take Your Time and Assess Your Options

This is the most important tip we can give you. Never rush your decision. The best thing you can do is take your time, check out each option you're interested in, and compare them.

Another thing you can do is ask for a personalized quote from each company and compare again. This process ensures you get the best possible option according to your needs and budget.

Check for Discounts

You can expect plenty of discounts from most homeowners insurance companies in Illinois. Some offer discounts for bundling different policies, while others give you a lower premium if you automate your payments, for example.

Feel free to check each company's "Discount" options and calculate how much you could save. In many cases, you'll be surprised to see how low your premiums can go when you apply for discounts.

Have a Good Credit Score

Insurance companies often consider your credit score or your past claims history to calculate your premium. In any case, having a good credit score will increase your chances of getting a lower premium, as well as access to a few benefits, depending on the company.

If you don't currently have a decent credit score, we suggest you work on it to see how much money you can save later.

Go for a Higher Deductible

Many go for lower deductibles since they allow them to pay more comfortably.

Unfortunately, asking for a lower deductible means you'll have to pay a higher annual premium. In many cases, this isn't convenient. We suggest you evaluate your current financial situation and see if you can afford a higher deductible.

Higher deductibles may involve a larger investment at first, but you'll pay less money for your premium eventually.

Consider Upgrading Your Home

The more secure your home is, the more likely your premium will go down. Remember that most insurance companies calculate your premium based on how risky your home is or how likely it is from getting damaged.

If you make a few security upgrades to your home, like adding cameras or a gate, you may be able to negotiate a lower premium.

Keep in mind that none of these tips will guarantee the perfect premium for your insurance policy. However, following them will increase your chances of saving money.

What Are the Top Five Homeowners Insurance Companies in Illinois?

You're now ready to start looking for the best homeowners insurance companies in Illinois. We chose the following companies based on their average annual premiums, discounts, and features.

Remember that every case is unique. You don't have to go for a certain company just because of its price. Make sure you evaluate everything these companies offer, and choose the perfect option to protect yourself and your property.

#1 - State Farm

State Farm is the largest home insurance company in the country. You can expect a wide range of insurance options to protect your property.

The company is known for offering relatively low premiums in comparison to other companies out there, making it a top option for many.

Coverage and Features

You'll get basic coverage that includes protection for:

• Dwellings and Other Structures
• Loss of Use
• Personal Property and Personal Liability
• Medical Payments

The best add-on you can get from this company is the "Increased Dwelling Limit," which allows you to extend your dwelling coverage up to 20% if you apply. Other extras include:

• Identity Fraud Coverage
• Water Backup Protection
• Damaged Foundation Coverage
• Earthquake Protection
• Home Rental Coverage
• Service Line Protection
• And more

Discounts

The average annual premium is $1,500 for State Farm. Remember you can pay more or less money depending on how many add-ons you get for your policy, as well as other factors.

You could make your premium lower by considering the following discounts:

• Bundling Policies
• Installing Protective Devices
• Upgrading Your Roof
• Getting Home Security Insurance

#2 - Allstate

Allstate is known for having unique bonuses for policyholders. If you want to make the most out of your insurance package, this may be an option worth considering.

Coverage and Features

This insurance company provides you with everything you need to protect your property and personal belongings. The basic packages include protection for:

• Dwellings and Other Structures
• Personal Liability
• Personal Property
• Medical Expenses

You can take things one step further by getting one of the company's add-ons, which include:

• Green Improvements
• Flood Coverage
• Water Backup Coverage
• Theft Restoration
• Earthquake Coverage

Discounts

The average annual premium is $1,660 for up to $250k of coverage. However, you could get a lower premium if you consider the following discounts:

• Responsible Payment
• Multi-policy Bundle
• Claim-free Discount
• Home Buyer Discount
• Welcome and Loyalty Discount
• Installation of Protective Devices
• Automatic Payment Setup
• Early Signing Discount

#3 - Farmers

Farmers is known for being one of the best insurance companies in the country. Its insurance packages are available in 40 states.

Coverage and Features

The standard policy of Farmers includes protection for your:

• Dwelling and Other Structures
• Personal Property
• Personal Liability
• Loss of Use
• Medical Expenses

Depending on the policy you get, you could also get covered for your personal property replacement cost or your extended replacement cost. Farmers tends to include those in its standard policies.

You could also consider a few of the company's many add-ons, which include:

• High-value Items
• Identity Theft
• Eco-Rebuild
• Equipment Breakdown
• Personal Injury
• Service Line
• Guaranteed Replacements
• Homeshare Coverage
• Declining Deductibles
• Claims Forgiveness
• And more

Discounts

Unfortunately for many, Farmers is on the expensive side. Its average annual premium is $2,190. However, you could get that premium down if you take advantage of the company's discount offers:

• Multi-line Discount
• Claim-free Discount
• Electronic Funds Transfer
• "Good Payer" Discount
• Green Certification
• "Rent to Own" Discount
• Installation of Protective Devices

#4 - Lemonade

Lemonade is considered a newcomer in the homeowners insurance industry. It started working in 2015, and it offers a more modern approach to insurance.

Coverage and Features

The unique approach of Lemonade is that it gets help from AI software to process your claims. AI can process some claims faster than a human would, so this assistance could mean that your claim may get solved faster.

Even though this approach may not seem attractive to people used to traditional insurance packages, the company has proven to be good enough for many Illinois residents.

You can manage your home insurance claims through the company's website or app. If you want to submit a claim traditionally, you can also call the company, and an agent will help you. Depending on the case, Lemonade may pay out your claim fast.

The two main problems with Lemonade are that it doesn't sell insurance in many states and that the company has received a few complaints over the years. You won't have to worry about the first one since the company operates in Illinois.

You can expect the following coverage in your basic package:

• Dwelling and Detached Structures
• Loss of Use
• Personal Property
• Personal Liability

If you want to add a few perks to your policy, you have:

• Extended Reconstruction Costs
• Foundation Water Damage Coverage
• High-value Item Coverage
• Water Backup Coverage
• Day Care Coverage
• Swimming Pool Liability
• and more

Discounts

You have to contact Lemonade if you want to get a quote on your home insurance. There's not much information about the average premiums online, although the plans seem to start at $25 per month.

On the other hand, you could get discounts for:

• Bundling Policies
• Paying Bills Annually
• Installing Protective Devices

#5 - American Family

American Family is a solid option if you're looking for a wide range of discounts and coverage options. It currently serves 19 states in the U.S., and Illinois is included.

Coverage and Features

This home insurance company offers everything you would need regarding basic protection, including:

• Personal Property
• Dwelling and Other Structures
• Loss of Use
• Personal Liability
• Medical Expenses
• Fires and Smoke
• Vandalism
• Power Surges

You can also add the following:

• Water Backup Protection
• Identity Theft Protection
• Protection for Home-based Businesses
• Service Line Protection
• Hidden Water Protection
• Senior Living Coverage
• And more

Discounts

The primary disadvantage of American Family is that its average annual premiums are higher than the national average. Currently, its average annual premium is $1,980. However, remember that your premium will always change depending on what you get, where the property is, and other factors.

These are the discounts you can get from American Family:

• Loyalty
• Automatic Payments
• Full Pay
• Paperless Payments
• Bundling Policies
• Renovations or New Home Purchases
• Smart Device Discounts

Are There Any Other Illinois Homeowners Insurance Companies to Consider?

What if none of the companies mentioned above convinces you? Don't worry; here are a few other options you could check out:

• USAA (not available to non-military residents)
• Nationwide
• Chubb
• Erie
• Country Financial
• Amica

Conclusion

Choosing the right home insurance company may be tough at first, especially if this is the first property you're buying.

Illinois is known for having a bustling economy, so there's no doubt you'll find an excellent property to invest in. Remember that insurance protection will save you from many headaches in the future. You can stop worrying about potential risks by working with the right homeowners insurance company.

Take the information we compiled here and use it to your advantage. Now that you know what to look for in homeowners insurance, you're prepared to find the perfect option to cover your needs.