Home Insurance for Rural Properties

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The U.S. Department of Agriculture reports that about 46 million people in the country live in rural areas. Every wise rural resident needs homeowners insurance to protect their often larger properties, but the options in rural areas aren’t always clear.

Keep reading to learn some details about home insurance for rural properties and what to look for in the best rural homeowners insurance companies.

Home Insurance for Rural Properties

Home insurance for rural properties protects policyholders from the same perils as typical home insurance plans for suburban and urban properties. But, you may need further protection for outbuildings, equipment, and other things you won’t find on common suburban properties.

Rural properties often have larger plots of land than urban and suburban homes. The land itself isn’t covered by insurance unless improvements exist. Rural properties often have many improvements. 

You can often find several outbuildings and features that urban or suburban plots don’t typically have, like silos, sheds, barns, gazebos, and more. Rural property insurance should cover these different features.

What Does Rural Homeowners Insurance Cover?

Rural homeowners insurance is designed to protect you and your property financially. Insurance plans cover several potential sources of damage, called perils. Your policy is divided into different sections that protect you from these perils.

Dwelling coverage: the part of your rural property insurance that protects the main structure of your house and its systems. Physical parts of your home, like the porch, roof, and walls fall under dwelling coverage. Your electrical wiring and HVAC systems do, too.

Other structures coverage: the part of rural homeowners insurance that protects features on your property that aren’t attached to your main house. These typically include fences, sheds, gazebos, detached garages, guest houses, driveways, and more.

Personal property coverage: covers your personal belongings in and around your property. Covered items typically include furniture, electronics, tools, clothes, and more.

Loss of use: loss of use reimburses you for temporary living expenses you incur if your home gets destroyed by a covered peril and you have to relocate while the insurer rebuilds or repairs it. Loss of use can cover hotel stays, food, gas, and more.

Liability coverage: liability coverage kicks in if a visitor gets hurt on your property and pursues you for damages. It also covers dog bites. Your liability coverage can cover their medical expenses and your legal fees.

Medical payments coverage: medical payments will cover medical expenses for minor injuries someone suffers on your property.

How Is Insuring a Rural Home Different?

You may need to raise the limits of your other structures coverage or personal property coverage when insuring rural property if you have several outbuildings or many unique or high-value pieces of equipment. 

You may also need to add special endorsements to your policy if you have a small hobby farm or do business at your rural home.

Other Structures Coverage

Rural properties often have much more land than urban or suburban dwellings. This extra space means homeowners have much more room for outbuildings or additional features on their property. Rural properties often have barns, sheds, detached garages, guest homes, and more. You could also have fences running throughout and surrounding your property.

In normal policies, other structures coverage is maxed out at about 10% of your dwelling coverage. So, if your insurance company values your home at $250,000, you’ll likely have about $25,000 of other structures coverage.

Having several buildings on your property will call for additional other structures coverage. One large barn, a few small sheds, or even hundreds of yards of fencing could easily reach the 10% standard limit. You may need to consult your insurer about upping your other structures limit to accurately cover all of the features on your property that aren’t attached to your house. 

Also, note how your policy covers fences. Many carriers will cover fences at actual cash value, meaning your provider will reimburse you for fence damage after factoring in depreciation. This means you may not get the total value for your fence, which can be especially problematic if you have specialty or expensive fences. 

Also, your insurer may exclude fences related to business activities, like corral fences or livestock pens, by default. Notify your insurer if you have such fences and want them covered.

Personal Property Coverage

Depending on what you keep around your rural property, you may need to raise your personal property coverage limits beyond the standard limits. Your insurer should be aware of high-value pieces or equipment used for home business or farm use. They will need to be designated in your policy to get them covered.

You may need special coverage in your policy if you have:

  • Livestock or other farm animals
  • Tractors or other farm equipment
  • Grain and crops

Your insurer may put individual limits on live animals if you want to add them to your policy, such as $2,000 per cattle, for example. Be aware of all animals and how they’re valued in your plan. Standard valuations of them may not be enough.

Insurance companies also have sub-limits for many high-value items in your house, like valuables or art. Many rural properties can also have special equipment that exceeds standard high-value sub-limits. Be sure to discuss values for farm equipment like tractors and grain, if applicable.  

Is Insurance Cheaper in Rural Areas?

No, home insurance is often more expensive in rural areas than in urban or suburban areas. Homes in rural areas often have higher premiums due to their increased distance from emergency services.

Insurance companies have classification systems for homes relating to their distance from fire stations or fire hydrants. The further away your home is from a fire station, the longer it can take the fire department to get there. Therefore, a fire that breaks out in your home can cause greater damage, which in turn costs more money for the insurer to repair.

The classification system, commonly called an ISO rating, ranges from 1 to 10. A lower number is better, so lower number ratings mean better fire department protection. A rural home with an ISO rating closer to 10 can pay more for insurance than a property with an ISO score of 1 or 2. Rural homes tend to have higher, worse ISO scores because they tend to be farther away from fire departments.

Factors That Affect Rural Home Insurance Rates

Insurance companies are in the business of mitigating risk. They look at several property characteristics to determine a policy premium for that property. Here are some important factors for rural home insurance rates:

  • Distance from fire hydrant/station
  • Flood zone
  • Property features – fences, sheds, outbuildings, etc.
  • Age of home and buildings
  • Business use of property

Having several outbuildings will likely raise your premiums. More buildings mean more to insure, which will cost more money. The age of the buildings is important, too. Older buildings are more likely to have issues leading to a claim. Old roofs, aging HVAC systems, and dated wiring components are all red flags to providers. They can raise your rates or nullify your possibility of getting a policy altogether.

You’ll also probably experience higher rates if you conduct any business on your property. You may need additional endorsements to cover customers’ liability on your property or special coverage of business use of buildings and equipment. Such endorsements, like an incidental farming personal liability endorsement, may raise your premiums.

Best Homeowners Insurance for Rural Properties

The best rural homeowners insurance will extend your coverage to every aspect of your rural property that you need, like additional other structures or unusual equipment. 

Recommending the best rural homeowners insurance companies is difficult because each rural homeowner has different properties and different needs. You should always compare premiums for multiple carriers in your area to find the best deal.

At Clovered, we want to make finding the best coverage easy. We can help you find the coverage you need at the price you want. Use our online quoting tool to find rural home insurance companies that will cover you, or you can call us directly at 833-255-4117 to chat with someone on our team of licensed agents.

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The editorial content on Clovered’s website is meant to be informational material and should not be considered legal advice.

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