Along with less square footage, tiny-home owners also see smaller insurance bills. A policy for the average tiny house is 106% cheaper than coverage for a normal-sized home, ValuePengiun.com found. For owners of tiny houses in Hawaii, the cost of home insurance is 484% cheaper than it is for a policy that covers a conventional size house (2,100 square feet), according to ValuePengiun. The average tiny house policy in the Aloha State is $186 annually. Depending on the state, downsizing from a full-size home to a tiny house can save a homeowner an average of 52% on the cost of insurance annually. The personal finance research site defined tiny houses as those around 400 square feet. States that see higher insurance rates for tiny houses also tend to experience costly natural disasters more regularly. Although smaller dwellings are more susceptible to catastrophic losses, said ValuePenguin, tiny-house owners can leverage percentage-based deductibles in lieu of cash-based deductibles. Using a percentage-based deductible can lead to an annual average 9% reduction in the cost to insure a tiny house because the structures have lower relative value. For example, the average annual cost in North Carolina for a tiny house policy that has a $500 deductible is $958. If using a percentage-based deductible of 2%, the annual cost drops 19% to $776, ValuePenguin noted. However, tiny-house owners in Nebraska will see no difference in the cost of home insurance no matter which deductible option they choose. Cornhuskers with tiny houses pay an average of $825 annually, making it the 22nd most expensive state to insure small dwellings. The above slideshow reveals the five states where it is most expensive to insure a tiny house, according to research from ValuePengiun.com. Related:

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