Platform · Glossary
Property insurance rate.
The property insurance rate is the annual homeowners insurance premium on a home, expressed as a percentage of its value.
PriceDNA uses it to estimate what it costs to insure a rental each year. Insurance costs have risen quickly in many markets, so a realistic local rate matters for cash flow.
How PriceDNA calculates it
For each census tract, PriceDNA takes the highest of three estimates:
- typical insurance cost divided by median home value for the surrounding city, from the Census American Community Survey;
- the same ratio for the county;
- the average homeowners premium per policy by ZIP code from the U.S. Treasury’s Federal Insurance Office (2018 to 2022 data, published in 2025), divided by that ZIP code’s median home value.
As with property tax, taking the highest estimate errs toward the cost an investor is more likely to face.
Formula
Annual insurance = property insurance rate × purchase price
In an analysis
This rate covers standard homeowners coverage. Flood and wind insurance are estimated separately where a property’s location calls for them. You can replace the local rate with a real quote.