Home Insurance Rates in the US Are Surging—Here’s Where They’re Rising the Fastest

Renters insurance: what it is and why you need it — (Photo : mentatdgt from Pexels)

Home insurance rates are surging across the United States, pricing some American households out of the housing market.

Home insurance rates in the US have surged 37.8% since 2019. In 2024 alone, home insurance rates jumped by 5.8% across the country, putting the average cost of home insurance at $2,478 annually. That is according to new data published by LendingTree.

A significant portion of the price increase is likely due to the rising home prices, which is at an average of $358,734, per Zillow. Researchers at LendingTree also attribute the skyrocketing prices of home insurance rates to weather disasters and steep home repairs as inflation pushes the cost of building materials higher.

Despite already surging 37.8% nationally, home insurance prices are even more expensive in states suffering from severe weather and other climate-related catastrophe. Home insurance companies paid out a staggering $100 billion last year, as reported by S&P Global Market Intelligence. This leads to either higher prices for consumers or fewer choices as insurance companies leave the market.

"Insurance companies have to repair more homes, and it's more expensive to rebuild each one than it might have been just five years ago," Robb Bhatt, LendingTree home insurance expert, said in the report. "When their costs of paying claims go up, they turn around and raise our rates. This is affecting prices for just about everyone, including people who haven't been directly impacted by a natural disaster, or at least not yet."

Where Home Insurance Rates Are Rising Most

By state, Arizona posted the most increase in home insurance rates from 2019 until March 24, rising 62.1% during that period. Since 2019, Arizona has suffered from eight extreme weather events, the losses of each exceeding $1 billion.

Following Arizona are Nebraska, which saw a spike of 59.9%, and Illinois, with a cumulative spike of 56.9%. Both states were also affected by billion-dollar disasters from 2019 through March 2024---specifically, 20 extreme weather events in Nebraska and 34 in Illinois.