15% Spike in Home Insurance Rates on the Way for Minnesotans, Report Predicts

More frequent severe weather events in Minnesota have led to sharp home insurance rate increases across the state.

The average annual cost of home insurance in Minnesota increased by 20% in 2024 to $3,524, according to Insurify’s home insurance report. The North Star State is also among the states where Insurify projects the fastest rate hikes in 2025, with another double-digit increase of 15% likely on the way for Minnesotans.

The insurance costs of severe weather

Throughout the 2010s, Minnesota faced 11 billion-dollar disasters, averaging about one per year, according to the National Centers for Environmental Information (NCEI). In the last five years, however, 23 billion-dollar events have hit Minnesota, an average of nearly five per year.

In 2024, Minnesota experienced 190 severe hail events, according to the National Oceanic and Atmospheric Administration (NOAA). Of those incidents, 26 had hail that was 2 inches or larger. A July storm dropped hail up to 4 inches in diameter near Monticello and Big Lake, NOAA reported.

Wildfires and hurricanes often grab the headlines, but hail can be a homeowner’s worst nightmare. Wind-driven hail can tear up siding, break windows, damage roofs, and severely injure people and animals.

Areas with a high risk of severe weather damage often face higher home insurance rates because of the higher likelihood of homeowners filing a claim. Roof damage, in particular, can drive up rates since home insurance policies cover roofs under the main dwelling coverage amount.

“Roof claims are going through the roof, pun intended,” said Daniel Lucas, carrier relations manager at Insurify. “Some insurers have even stopped writing policies for homes with a roof over 10 years old. That’s so difficult to swallow given that roofs are meant to last 20, 30, 50 years.”

What’s next: Minnesota’s FAIR safety net

When home insurers stop selling new policies in high-risk areas, it can leave homeowners without coverage or any fallback options. The Minnesota Fair Access to Insurance Requirements (FAIR) Plan can help homeowners who can’t find coverage in the standard market.

The mission of Minnesota’s FAIR Plan is to “provide basic and affordable property insurance” to homeowners “without regard for environmental hazards,” as long as the property is reasonably maintained.

FAIR Plan coverage should still be comparable to basic coverage in the standard insurance market.

While FAIR Plan homeowners insurance can be more expensive than a standard policy because it typically covers a high-risk property, rates in Minnesota were moderate in 2023. That year, the FAIR Plan wrote 3,773 policies, mostly for residential properties, at an average of $960 per year per policy, according to the Property Insurance Plans Service Office.

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