If you're shopping for homeowners insurance in Allentown, you've probably noticed something: the Lehigh Valley is growing fast, home values are climbing, and everyone wants to know what they should actually be paying to protect their investment. The good news? Allentown homeowners typically pay less than the national average for home insurance. The catch? Your actual rate depends heavily on whether you're living in a historic row home downtown or a newer suburban build in the surrounding neighborhoods.
Here's what you need to know about homeowners insurance costs in Allentown, how to get competitive rates, and what coverage considerations matter most in this corner of Pennsylvania.
What Allentown Homeowners Actually Pay
The average homeowner in Allentown pays between $1,415 and $1,836 annually for home insurance, depending on coverage levels and the insurance company. That breaks down to roughly $118 to $153 per month. Compare that to Philadelphia homeowners who pay around $246 monthly, and you're looking at significant savings just by living in Allentown.
Pennsylvania's statewide average sits around $1,575 per year, which means Allentown's rates are competitive even within the state. Nationally, homeowners pay an average of $2,423 annually, so Pennsylvania residents—Allentown included—enjoy rates that are hundreds of dollars lower than most of the country.
But here's the thing: these are averages. Your actual premium depends on factors like your home's age, value, claims history, credit score, and proximity to fire hydrants. A newly built suburban home with modern systems will cost less to insure than a 100-year-old row home with outdated electrical wiring and plumbing that hasn't been updated since the 1970s.
Historic Homes and Row Houses: What You Need to Know
Allentown has beautiful historic neighborhoods filled with charming row homes and older construction. If you own one of these properties, you need to pay special attention to your insurance coverage because standard policies might not fully protect you.
The biggest issue? Building codes have changed dramatically since your home was built. If you file a claim for significant damage, you'll likely be required to bring the entire structure up to current building codes—not just repair what was damaged. This is where Ordinance or Law coverage becomes essential. This add-on helps pay for code-required upgrades, demolition costs, and bringing undamaged parts of your home up to current standards after a covered loss.
Insurance companies also look closely at the condition of older homes. If your electrical panel is outdated, your roof has more than 15 years on it, or your plumbing is original to the house, you might pay higher premiums or even struggle to find coverage. The solution? Update major systems proactively. Replacing old wiring, updating your electrical panel, or installing a new roof not only makes your home safer—it also makes you more attractive to insurers and can lower your rates.
One more critical point for historic homes: insure to replacement cost, not market value. Your charming 1920s row home might have a market value of $180,000, but rebuilding it with period-appropriate materials and skilled craftsmen could cost $250,000 or more. Make sure your dwelling coverage reflects what it would actually cost to rebuild, not just what the house would sell for.
Flood Zones and the Lehigh River
Let's talk about something that surprises many Allentown homeowners: standard homeowners insurance doesn't cover flood damage. Not even a little bit. If water from the Lehigh River, Little Lehigh Creek, or heavy rainfall enters your home, your regular policy won't pay a dime.
About 5% of the Lehigh Valley area sits within a 1% annual chance floodplain (what used to be called a 100-year floodplain), and another 6% falls within a 0.2% chance floodplain. If you're near the Lehigh River or in lower-lying areas, you might be in one of these zones. You can check your property's flood risk using FEMA's Flood Map Service Center by searching your address.
If you're in a high-risk flood zone and have a mortgage, your lender will require flood insurance. Even if you're not required to buy it, consider the coverage anyway. Through the National Flood Insurance Program, you can get coverage at rates that may be up to 70% less expensive than private flood insurance. A policy typically costs a few hundred dollars annually—far less than paying out of pocket to repair flood damage.
How to Lower Your Homeowners Insurance Costs
Here's where you can actually save money on your Allentown homeowners insurance without sacrificing coverage:
Bundle your home and auto insurance. Pennsylvania homeowners save an average of 9% by bundling policies, and some insurers offer much bigger discounts. State Farm offers up to 24% off in Pennsylvania for bundling, while Allstate customers save an average of $912 annually. That's real money back in your pocket every year.
Install smart home devices. Ring doorbells, Nest thermostats, and smart security systems aren't just convenient—they can save you up to 15% on your premium. Insurance companies love these devices because they reduce the risk of theft, fire, and water damage. A monitored alarm system alone can typically save you up to 15% on coverage.
Raise your deductible strategically. Moving from a $500 deductible to $1,000 or even $2,500 can lower your premium substantially. Just make sure you have enough savings set aside to cover the higher deductible if you need to file a claim.
Maintain a claims-free record. Going several years without filing a claim can qualify you for loyalty discounts and claims-free discounts. Some insurers offer significant savings for homeowners who haven't filed claims in three, five, or even ten years.
Shop around regularly. Erie Insurance consistently ranks as one of the best and most affordable options for Allentown homeowners, while Allstate has been found to offer the cheapest rates in the area at around $1,070 annually. Don't just stick with your current insurer out of habit—compare quotes every few years to make sure you're getting competitive rates.
The Lehigh Valley Housing Market Impact
Allentown's housing market has been booming. Home values increased 7% in 2024, with the typical home now valued around $267,465. Zillow even ranked Allentown as the No. 6 most popular housing market in the country for 2024. That's a big deal—and it matters for your insurance.
As home values rise, replacement costs also increase. Construction materials, labor costs, and building supplies have all gotten more expensive in recent years. That means the dwelling coverage you had three years ago might not be enough to fully rebuild your home today. Review your policy annually and adjust your coverage limits to keep pace with rising replacement costs.
It's also worth noting that Pennsylvania homeowners faced a 7% rate increase in 2023, and the average went up 19% for those who renewed in the last year. Insurance costs are rising across the board due to increased claims, severe weather events, and inflation in construction costs. This makes shopping around and maximizing discounts even more important.
Getting Started with Homeowners Insurance in Allentown
If you're shopping for homeowners insurance in Allentown or reviewing your current policy, here's your action plan:
First, calculate your home's true replacement cost. This isn't what you paid for it or what it would sell for today—it's what it would cost to rebuild from the ground up. For older or historic homes, this might be significantly higher than market value.
Second, check if you're in a flood zone and whether you need separate flood insurance. Don't skip this step—flood damage can be financially devastating if you're not covered.
Third, get quotes from at least three different insurers. Include Erie and Allstate in your comparison since they consistently offer competitive rates in Allentown. Ask about bundling discounts, smart home device discounts, and any other savings opportunities.
Finally, if you own an older home, ask specifically about Ordinance or Law coverage and make sure your policy includes it. This coverage isn't always included by default, but it's absolutely essential for historic properties.
The bottom line? Allentown homeowners have access to competitive insurance rates, but getting the best deal requires understanding your home's specific needs and shopping strategically. Take the time to compare options, maximize your discounts, and ensure you have the right coverage for your property. Your home is likely your biggest investment—protecting it properly is worth the effort.
