Homeowners insurance costs soar as insurers drop more customers: NAIC

Homeowners insurance costs are swelling rapidly for consumers — and even for those able to pay, policies are getting harder to keep as insurers drop customers at a higher rate, according to a new industry report.

Average premiums for homeowners insurance rose faster than inflation across all major regions of the country from 2018 to 2024, according to a report released Wednesday by the National Association of Insurance Commissioners, a group that represents state insurance regulators.

Consumers saw their average premiums rise by 18% in the Northeast, 25% in the Midwest, 27% in the Southeast and 43% in the West over that seven-year period, even after accounting for inflation, according to the report, which broke out data across four regional zones.

Average premiums were highest in the Southeast, at $1,818 per year in 2024, while those in the Northeast were lowest at $1,396, NAIC said.

Premiums have risen another 7% since the beginning of 2025, according to the Bureau of Labor Statistics’ producer price index. The index doesn’t 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.

The report, compiled with data from state insurance agencies, was the group’s first comprehensive data analysis of the homeowners insurance market in several years, NAIC officials said.

Climate change, rising home rebuilding costs and other factors have driven up financial risk for insurers, who are passing that financial burden on to consumers, at least in part, insurance experts said.

Meanwhile, the dynamic is straining homeowners amid a broader affordability crunch and a U.S. inflation rate that has been above policymakers’ target for more than five years.

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 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, said Peter Kochenburger, an insurance expert and a visiting professor of law at Southern University Law Center.

“It’s a big problem,” Kochenburger said of rising costs for consumers.

The NAIC analysis also showed that insurers are dropping customers at elevated rates, opting not to renew their policies when their terms expire. This generally happens when an insurer thinks the risk outweighs their profit potential, Kochenburger said.

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…