Home insurance is getting more expensive and less available across the United States as insurers raise prices and pull back from areas facing extreme weather. That shift is reshaping communities from Southwest Florida, battered by Hurricane Ian in 2022, to wildfire-prone regions of California and hail-scarred towns in the Great Plains.
Rising disaster costs, more property in harm’s way, and higher rebuilding expenses are driving the change. People continue to move to coasts and forested areas, and inflation has made materials costlier to replace. Between 2018 and 2022, the cost of home insurance rose about 8% faster than overall inflation, according to a Treasury Department report published in January.
Insurers are passing mounting losses to consumers. “We’ve seen growing prices everywhere,” says Carolyn Kousky, an economic policy expert at the Environmental Defense Fund. Higher premiums and policy nonrenewals squeeze household budgets already stretched by rising food and transport costs. Most homeowners with mortgages must carry insurance, and renters often face higher rents as landlords pass along insurance costs.
The problem is nationwide, not limited to coasts. Gulf Coast states have long battled high premiums and insurer withdrawals; Florida’s nonrenewal rate climbed 280% between 2018 and 2023, per a 2024 Senate Budget Committee report. California has faced large wildfire losses and retreating insurers. Meanwhile, the center of the country has emerged as a hot spot: some parts of the Great Plains pay as much as 45% more than the national average for property insurance, a rise driven in part by increasing hail losses. Hailstorms caused an estimated $160 billion in home damage nationwide in 2024, the Insurance Information Institute estimates.
Local impacts illustrate the breadth of the issue. In Cozad, Nebraska, a 2024 hail storm caused about $100 million in damage in a town of 4,000. Afterward, many homeowners and businesses were dropped by insurers or saw steep price hikes. Nebraska now has the highest average homeowners insurance cost in the country — nearly $6,400 this year, about $4,000 above the national average, according to Bankrate. “It’s just becoming unaffordable in our state,” says agent Josh Tapio in Omaha.
In Southwest Florida, homeowners face rising costs for both homeowners and flood insurance. Floridians pay nearly $5,800 on average this year for home insurance, the third-highest rate nationally and roughly $3,350 above the national average. Realtors warn that escalating insurance costs could trigger foreclosures as retirees on fixed incomes and other middle-class residents can no longer afford their homes. Higher insurance raises the ongoing cost of ownership and can depress sales prices; Florida State University researchers found a 10% rise in homeowners insurance reduced housing prices by 4.6% in one study. In Lee County, home values have fallen sharply since Hurricane Ian, a sign of how insured-cost dynamics can weaken local markets.
David Burt of DeltaTerra Capital warns broader consequences: if home values fall substantially in many communities to reflect insurance realities, mortgage defaults could rise, which in turn could push up mortgage costs nationwide.
One pathway to reducing disaster costs is mitigation: retrofitting homes and neighborhoods to resist hazards. Lake County, California — which has seen nine damaging wildfires since 2015 — is pursuing community-scale home hardening. Projects include replacing flammable bark mulch with gravel, sealing vents and gaps, retrofitting roofs and gates, creating fuel breaks, and improving evacuation routes. The county is part of a state and federally funded pilot aiming to cluster improvements so that groups of homes are less likely to ignite and spread fires.
Still, residents in Lake County face a deteriorating insurance outlook. Policy cancellations have outpaced many other places, and many rely on California’s last-resort FAIR plan, which sought a 36% premium increase. Insurers have begun offering limited discounts for individual retrofits, but community-wide work often isn’t reflected in underwriting because insurers lack consistent, trusted data about local risk reductions.
Industry and risk analysts say insurers need access to better data so they can reward mitigation. Nancy Watkins, a consulting actuary with Milliman, is helping launch the WUI Data Commons, a database meant to aggregate community and landscape wildfire projects so insurance pricing can reflect reduced risk. Challenges remain, including consumer privacy and insurer participation, but greater transparency could create financial incentives for communities to invest in resilience.
Experts emphasize that insurers should incentivize preparation with better rates to build market trust and motivate homeowners and communities. “It’s starting, but more needs to be done,” Kousky says. Without stronger incentives and clearer signals that mitigation lowers risk, many communities will continue to face higher premiums, fewer available policies, falling home values, and the economic strain that follows.
NPR reporters across the country documented these patterns: rising premiums and nonrenewals in Florida, unaffordable coverage in Nebraska after severe hail, and community hardening efforts in California that have yet to bring broad insurance relief. The emerging picture is of an insurance market adapting to climate-driven losses — in ways that are reshaping who can afford to live where and what communities must do to remain insurable.
NPR’s Ryan Kellman and Robert Benincasa contributed reporting.
