By the Yellow Ribbon Insurance team · Bill Cline, Licensed Insurance Agent
What a standard Indiana homeowners policy covers, the four gaps it leaves open, what really moves the price here, and the questions to ask before your next quote.
Quick answer
A standard Indiana homeowners policy pays to repair or rebuild your house, detached structures and belongings after covered damage like fire, wind, hail or a burst pipe, and it covers extra living costs and liability. Flood, sewer backup, earthquake and mine subsidence need separate coverage.
- Indiana's average HO-3 premium was $1,191 in 2022, below the $1,569 U.S. average, per the NAIC. That's a statewide average, not a quote for your home.
- Most mortgage lenders require homeowners insurance for as long as you have the loan.
- A new flood policy usually doesn't take effect for 30 days, so it needs to be in place before the forecast turns.
- Southern and western Indiana have gaps of their own: mine subsidence in 26 designated counties, and earthquake risk near the Wabash Valley.
Do this: pull out your declarations page and check four things: your dwelling limit, how the roof is paid out, your wind/hail deductible and whether water backup is included.
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You bought the house, the lender asked for proof of insurance, and the policy has lived in a drawer ever since. Then a hailstorm rolls through, the basement takes on water, or a renewal letter shows up with a higher number, and you realize you don't know what your Indiana home insurance actually does. This guide walks through what a standard homeowners policy covers, what it quietly leaves out, what drives the price here, and the questions worth asking before your next quote. We wrote it for Indiana homeowners, starting with our neighbors in Floyd, Clark and Harrison counties.
Indiana home insurance: key facts
| Average HO-3 premium (2022) | $1,191 in Indiana vs. $1,569 U.S.NAIC data, via the Insurance Information Institute |
|---|---|
| Required? | Most mortgage lenders require it for the life of the loanNAIC consumer guide |
| Flood | Not included in a standard homeowners policyIN.gov flood insurance |
| Flood waiting period | Usually 30 days after purchase, with a few exceptionsFEMA / NFIP |
| Mine subsidence | Available in 26 designated counties, up to $500,000 per structureIndiana Department of Insurance |
| Tornadoes | Indiana averages 22 a year; 2026 set a record with 88 through September 10NWS Indianapolis |
| Consumer help | Indiana Department of Insurance, 1-800-622-4461IDOI complaints |
What does a standard Indiana homeowners policy cover?
The short answer: A standard homeowners policy bundles six coverages, for your house, other structures, belongings, extra living costs, personal liability and guests' medical bills, into one contract.
Those six pieces show up on your declarations page as separate lines, each with its own limit. The NAIC's homeowners guide describes them the same way, and the Indiana Department of Insurance notes that personal liability protection is generally part of most homeowners policies. Here's what each part does and what to check.
| Coverage | What it pays for | What to check |
|---|---|---|
| Dwelling | Damage to the house itself and attached structures | Is the limit what it would cost to rebuild, not what the house would sell for? |
| Other structures | Detached garages, sheds, fences | Usually a share of the dwelling limit. Is it enough for a pole barn or big garage? |
| Personal property | Furniture, clothes, electronics, tools | Replacement cost or actual cash value? Any special limits on jewelry or collections? |
| Loss of use | Some of your extra living costs if you can't stay in the home after a covered loss | How much, and for how long? |
| Personal liability | Claims that you or your family caused injury or damage to others | Does the limit fit what you own and earn? |
| Medical payments | Medical bills for guests hurt on your property | Small by design. Liability does the heavy lifting. |
The most common package is the HO-3, or special form, policy. The Insurance Information Institute's notes on NAIC data describe it as covering the building against all risks except those specifically excluded, and personal property against a broad list of named perils. That difference matters: for the house, you read the exclusions to find the gaps; for your belongings, you read the list of what's included.
Limit tip: your dwelling limit should track what it would cost to rebuild the house today, which can be very different from its market value or your loan balance. If you've remodeled, added a room or finished the basement since you bought the policy, tell your agent. You can see the coverages we write on our home insurance page.
Bill Cline
Licensed insurance agent · Veteran · Licensed since 2018
Bill owns Yellow Ribbon Insurance in New Albany. More about Bill.
What does Indiana homeowners insurance usually leave out?
The short answer: Flood, sewer or drain backup, earthquake and mine subsidence are the four big gaps in Indiana, and each one is closed a different way.
None of these is a technicality. They're the claims that surprise people most, because the damage looks like something a homeowners policy "should" cover. Here's how the common perils usually line up. Your own policy wording decides the details.
| Peril | Standard policy | How it's usually covered | Source |
|---|---|---|---|
| Fire, lightning, wind, hail, tornado | Covered | Built into the policy; check your wind/hail deductible | NAIC |
| Sewer or drain backup, sump overflow | Limited or none | Added by endorsement, with its own limit | NAIC |
| Flood (rising water from outside) | Excluded | A separate flood policy (NFIP or private) | IN.gov |
| Earthquake | Excluded | An endorsement or a separate policy | NAIC |
| Mine subsidence | Separate coverage | Added to the homeowners policy in 26 designated counties | IDOI |
The basement trap: water in a basement can come from three places: a backed-up drain or sump, surface water from outside, or a burst pipe inside. Each lands under a different coverage, or none. In our experience, this is the gap that surprises Southern Indiana homeowners most. If your home has a basement or a sump pump, ask specifically about water backup coverage and its limit.
Flood, earthquake and mine subsidence each come down to where your home sits, so we cover how to check your own address further down.
How much does homeowners insurance cost in Indiana?
The short answer: The latest published NAIC figure puts Indiana's average HO-3 premium at $1,191 for 2022, below the $1,569 national average, but it's a statewide average from 2022, not a quote for your home.
Indiana's average HO-3 homeowners premium in 2022, 35th among the states, versus $1,569 for the U.S. Source: NAIC data published by the Insurance Information Institute. Checked September 2026. Not a quote.
Where that number comes from, and why you'll see higher ones
The NAIC figure is built from premiums insurers actually wrote on owner-occupied HO-3 policies across the state. It's real money paid, but it's an average of every kind of house, and the 2022 data wasn't published until 2025, so it lags today's prices by several years. Prices were already climbing: the NAIC reported that average premiums for dwelling fire and homeowners policies rose 10.5% nationally between 2021 and 2022.
You'll find much higher "average" figures online. Most of those are prices for one sample house, with a set coverage amount, deductible and ZIP code, priced this year. That's a different question from what Indiana homeowners actually paid, which is why published numbers can differ by a thousand dollars or more. Neither is wrong, and neither is your price. Your premium depends on your house. Our guide to what homeowners insurance costs in Indiana lays the published figures side by side.
Where the home sits
Local storm and claim history, distance to a fire station and flood exposure all feed the price.
What it costs to rebuild
Square footage, construction type and finishes set the dwelling limit, the biggest driver.
Roof age and material
An older roof can change both the price and how a roof claim is paid out.
Your deductible choices
A higher deductible lowers the premium but raises what you pay after a loss.
Claims history
Past claims on the home or by you can follow a policy for years.
Updates and protection
A newer roof, updated systems or monitored alarms may qualify for credits. Eligibility varies.
The only way to know your number is to price your house. A quote with a licensed agent shows you that number, and it's a good moment to check whether your current dwelling limit and deductibles still make sense.
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See what your Indiana home would cost to insure
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4.8★ from 214 Google reviewsVeteran-ownedLicensed in Indiana & Kentucky
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Please add your first and last name, a 10-digit phone number and a valid email.
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Is homeowners insurance required in Indiana?
The short answer: The practical requirement comes from your lender, because most mortgage lenders require homeowners insurance for as long as the loan is open.
The NAIC's consumer guide puts it plainly: most mortgage lenders require you to have insurance as long as you have a mortgage. The lender is protecting its collateral, which is why proof of coverage is part of closing on a home.
Once the house is paid off, keeping coverage is your decision, and the building isn't the only thing at stake. The same policy is what answers when a guest slips on your steps or a tree from your yard lands on the neighbor's car. Dropping it means carrying both of those risks yourself.
How do Indiana tornadoes, hail and wind affect your policy?
The short answer: Wind, hail and tornado damage are normally covered, so the questions that matter are how your roof is paid out and whether a separate wind or hail deductible applies.
Indiana gets real weather. The National Weather Service in Indianapolis says the state averages 22 tornadoes a year, and 2026 set a single-year record with 88 through September 10. Southern Indiana remembers March 2, 2012, when an EF4 tornado hit Henryville in Clark County.
Because those perils are covered, the fine print is what decides how much of a storm claim you pay yourself. Two lines on your declarations page do most of that work:
- Roof settlement. Some policies pay replacement cost on the roof; others pay actual cash value, which subtracts wear and age. The NAIC notes that actual cash value often doesn't pay enough to fully repair or replace the damage.
- Wind or hail deductible. Some policies apply a separate deductible to wind and hail claims, sometimes a percentage of your dwelling limit rather than a flat amount. A 1% deductible on a $250,000 dwelling limit is $2,500.
Illustrative scenario
A spring hailstorm ruins a 15-year-old roof on a home insured for $250,000. Replacing it costs $15,000. The policy has a 1% wind/hail deductible ($2,500).
| Replacement-cost roof settlement: $15,000 − $2,500 | $12,500 |
| Actual-cash-value settlement if the roof is valued at 40% of new: $6,000 − $2,500 | $3,500 |
| Difference you'd cover yourself | $9,000 |
Illustrative figures only, not a quote or a promise of how any claim is paid. How your policy settles a roof claim, and how depreciation is figured, depends on your policy form. It's worth confirming before storm season.
Do Indiana homeowners need flood, earthquake or mine subsidence coverage?
The short answer: Each is excluded from a standard policy, so the decision comes down to your address: its flood risk, its distance from Indiana's seismic zones, and whether your county is on the mine subsidence list.
Flood
Indiana's state flood site is direct about it: a standard homeowner's policy does not automatically include flood insurance. To check your own risk, the Indiana DNR's Indiana Floodplain Information Portal shows FEMA and DNR floodplains for an address. It can also generate a Floodplain Analysis and Regulatory Assessment that includes a base flood elevation for the site.
Timing matters too. Under the NFIP, coverage generally starts 30 days after purchase. There's no wait if you buy it while making, increasing, extending or renewing a mortgage, and a one-day wait applies in a couple of specific cases, such as buying within 12 months after your property is newly mapped into a high-risk flood area. Homes along the Ohio River and its creeks are worth checking first.
Earthquake
The NAIC lists earthquake among the perils commonly excluded from homeowners policies, available instead as an endorsement or a separate policy. The Indiana Department of Homeland Security notes that Indiana is near two major seismic zones: the New Madrid Seismic Zone and the Wabash Valley Seismic Zone, which sits in southwestern Indiana and southeastern Illinois.
Mine subsidence
Parts of Indiana sit over old underground coal mines. The Indiana Department of Insurance explains that mine subsidence coverage can be added to your homeowners policy in 26 designated counties. It pays up to $500,000 per structure, with a 2% deductible (minimum $250, maximum $500).
The counties are Clay, Crawford, Daviess, Dubois, Fountain, Gibson, Greene, Knox, Lawrence, Martin, Monroe, Montgomery, Orange, Owen, Parke, Perry, Pike, Posey, Putnam, Spencer, Sullivan, Vanderburgh, Vermillion, Vigo, Warren and Warrick. Crawford, Orange and Perry are close to us; Floyd, Clark and Harrison are not on the list. One catch from the Indiana DNR: the property must be insured before any subsidence damage happens.
What happens if your Indiana home insurance is canceled or not renewed?
The short answer: Indiana law requires advance notice, generally at least 20 days before a nonrenewal, which gives you time to find out why and line up new coverage.
Under Indiana Code 27-7-12-4, an insurer that won't renew must give notice at least 20 days before the policy period ends. For cancellations, IC 27-7-12-3 generally requires 10 days' notice for nonpayment or during a policy's first 60 days, and 20 days after that. If you get one of those letters:
- Ask why. A roof condition, a claim or an unrepaired issue can often be fixed or explained. Our guide to what to do after a nonrenewal walks through every step.
- Don't let coverage lapse, especially if you have a mortgage. The lender will notice.
- Know the backstop. The Indiana FAIR Plan is for homeowners who have been turned down by at least three insurance companies. You apply through any licensed agent, and dwelling coverage is capped at $250,000.
- Get help if something seems wrong. The Indiana Department of Insurance takes consumer complaints online, which it calls the preferred and most efficient method, or at 1-800-622-4461.
What should you have ready for an Indiana home insurance quote?
The short answer: Have your address, square footage, year built and construction type ready, plus your current declarations page, your roof's age and a list of major updates.
The NAIC's guide lists the basics any quote starts with: where the home is located, its square footage, when it was built and the type of construction. The rest makes the quote accurate the first time:
- Your current declarations page: limits, deductibles and endorsements
- Roof age and material, plus the years the plumbing, electrical and heating were updated
- Detached structures: garage, barn, shed, fencing, pool
- Claims in the last several years, and your mortgage company's details
- Valuables that may need their own coverage, like jewelry or collections
Then ask the questions that decide how a claim goes, not only what the premium is:
- Is my dwelling limit based on what it would cost to rebuild?
- Is the roof paid at replacement cost or actual cash value? What about my belongings?
- Is there a separate wind or hail deductible, and is it a flat amount or a percentage?
- Is water or sewer backup included, and what's the limit?
- At this address, should I look at flood, earthquake or mine subsidence coverage?
- Which discounts might I qualify for? Bundling with auto insurance, protective devices or a newer roof may help, and eligibility varies.
- How much liability coverage fits what I own?
Buying your first place? Our first-time homeowner guide covers what to settle before closing day.
How can you keep your coverage right without overpaying?
The short answer: Review the policy every year, raise deductibles only as far as your savings can cover, and ask which discounts you qualify for before you cut any coverage.
The expensive mistake is almost never the premium. It's the claim that turns out to be under-covered: a dwelling limit that fell behind construction costs, a roof paid at depreciated value, a basement with no water backup coverage. Our guides to roof age and roof settlement terms and water-backup coverage go deeper on those two. A few habits keep that from happening:
- Review once a year, and any time you remodel, add a structure or buy something valuable.
- Tune your deductible to your savings. A higher deductible lowers the premium, but only if you could comfortably pay it after a storm.
- Keep a home inventory. The NAIC suggests going room by room, writing things down and taking photos or video, storing the record somewhere other than the house, and updating it annually.
- Ask about discounts before cutting coverage. Bundling, protective devices and home updates may lower the price without opening a gap. Eligibility varies.
A free coverage review with our New Albany office is the easiest way to run through all of this with your actual policy in hand. If you live in the city, our New Albany home insurance guide covers local storm, flood and river-town questions (Clark County neighbors can start with Jeffersonville or Clarksville), our home insurance quote checklist lists what to gather, and our Indiana car insurance guide does the same job for the car in the driveway. You can also stop by or call.
Bottom line
In short: a standard Indiana homeowners policy covers a lot, but not everything people assume, so the details on your declarations page matter.
The six core coverages handle fire, wind, hail and liability. Flood, water backup, earthquake and mine subsidence need your attention, and roof settlement terms and wind/hail deductibles decide how storm claims feel. Averages like the NAIC's $1,191 are useful context, but your price depends on your house. Have your declarations page ready, ask the seven questions above, and you'll have a much clearer picture of what you're buying.
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Get a free home coverage review from New Albany
Start with your ZIP. A licensed agent from our New Albany office reviews every request personally.
Please enter a valid 5-digit ZIP code.
4.8★ from 214 Google reviewsVeteran-ownedLicensed in Indiana & Kentucky
Prefer to talk? (812) 577-8749 · Mon–Thu 9–6, Fri 9–5 ET
Almost done
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A licensed agent from our New Albany office reviews every request personally.
Please add your first and last name, a 10-digit phone number and a valid email.
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A licensed agent from our New Albany office will reach out to go over your coverage.
Frequently asked questions
Is homeowners insurance required by law in Indiana?
The requirement usually comes from your lender. According to the NAIC's consumer guide, most mortgage lenders require insurance for as long as you have a mortgage, because the house is their collateral. Once the house is paid off, keeping coverage is your decision. Before you drop it, remember that the same policy pays when a storm takes the roof or a guest is hurt on your property. Without it, both of those costs land on you.
Does homeowners insurance cover tornado and hail damage in Indiana?
Yes, wind, hail and tornado damage are normally covered perils under a standard homeowners policy. The questions that decide your out-of-pocket cost are how the policy settles a roof claim (replacement cost or actual cash value) and whether a separate wind or hail deductible applies, sometimes as a percentage of your dwelling limit. With Indiana averaging 22 tornadoes a year, according to the National Weather Service in Indianapolis, it's worth checking both lines before storm season.
How long does it take for a new flood insurance policy to start?
Under the National Flood Insurance Program, coverage generally takes effect 30 days after you buy it, according to FEMA's FloodSmart site. There's no waiting period if you buy flood coverage while making, increasing, extending or renewing a mortgage, and a one-day wait applies in a couple of specific cases, such as buying within 12 months after your property is newly mapped into a high-risk flood area. Because of the 30-day rule, flood coverage has to be in place well before the forecast turns.
Who can buy mine subsidence insurance in Indiana?
Owners of homes, farms and commercial property in 26 designated Indiana counties, mostly in the southwest and west-central part of the state, can add mine subsidence coverage to their property policy. According to the Indiana Department of Insurance, it covers up to $500,000 per structure with a 2% deductible (minimum $250, maximum $500). Floyd, Clark and Harrison counties aren't on the list; nearby Crawford, Orange and Perry are.
What can I do if my homeowners policy isn't renewed?
First, use the notice period. Indiana law generally requires at least 20 days' notice before a nonrenewal. Ask the insurer why, because issues like a roof condition can sometimes be fixed. Then line up replacement coverage before the old policy ends, especially if you have a mortgage. If several insurers turn you down, the Indiana FAIR Plan exists for homeowners denied by at least three companies, and you apply through a licensed agent. For problems with an insurer, contact the Indiana Department of Insurance at 1-800-622-4461.