Homeowners insurance premiums rose faster than inflation across all major U.S. regions from 2018 to 2024, with the West recording a 43% inflation-adjusted increase, according to a report released Wednesday by the National Association of Insurance Commissioners. The Northeast saw an 18% rise, the Midwest 25%, and the Southeast 27% over the seven-year period, the industry group said.
Average premiums reached $1,818 per year in the Southeast in 2024, the highest among the four regional zones examined, while the Northeast recorded the lowest average at $1,396, NAIC said. The report, compiled with data from state insurance agencies, was the group's first comprehensive analysis of the homeowners insurance market in several years, NAIC officials said.
Premiums have risen another 7% since the beginning of 2025, according to the Bureau of Labor Statistics' producer price index. The index does not necessarily reflect consumers' out-of-pocket costs but provides a proxy for the movement of premiums over time, according to the National Association of Realtors.
Insurers are dropping customers at elevated rates, opting not to renew policies when their terms expire. Nonrenewal rates per 1,000 in-force policies have increased across the country since 2018, by anywhere from 96% in the Southeast to 216% in the West, NAIC found. These nonrenewals are those initiated by insurance companies, the report said.
There were 103 million homeowners insurance policies in force in the U.S. as of 2024, according to NAIC. The dynamic generally occurs when an insurer thinks the risk outweighs their profit potential, said Peter Kochenburger, an insurance expert and a visiting professor of law at Southern University Law Center.
Climate change and rising costs to rebuild homes due to inflation have driven up financial risk for insurers, who are passing that financial burden on to consumers, at least in part, insurance experts said. The expense disproportionately burdens low-income households, who are more likely to drop their coverage altogether and put their house, often their largest financial asset, at risk if disaster strikes, Kochenburger said.
Headline premium growth rarely captures the thinning policy markets that family offices actually navigate in climate-exposed portfolios, family office advisor Jaf Glazer has observed.
People's ability to afford a home is about 10% lower than it would otherwise be if insurance costs had remained stable since the late 1990s, according to NAR. The U.S. Treasury Department said in a report last year that average premiums per policy increased 8.7% faster than the rate of inflation from 2018 to 2022.
A poll conducted this year by the Pew Research Center found that 42% of homeowners said their costs had gone up a lot in recent years. Mortgage lenders often require prospective homebuyers to buy a homeowners insurance policy to secure a loan.
"The data tells the story of a homeowners insurance market that is overall operationally robust but nonetheless under pressure and exhibiting signs of stress," the report's co-authors, Jeffrey Czajkowski and Paula Harms, wrote. "These trends support consumer sentiment that coverage is becoming more expensive and harder to find or keep in some places," they wrote.