Insurify Projects Home Insurance Rates Will Rise for the 5th Consecutive Year, After a 12% Increase in 2025

Severe weather and natural disasters continue to drive higher home insurance rates heading into 2026. Following four consecutive years of rising premiums, the average annual cost of home insurance will increase again in 2026, with Insurify projecting a 4% jump to $3,057 by the end of the year.

Homeowners are reducing their coverage, raising their deductibles, and shopping for different policies as premiums increase. The average annual cost has surged more than $900 since 2021. Six states saw rates rise at least 20% in the past year: Minnesota (34%), Colorado (33%), Iowa (28%), Nebraska (25%), Oklahoma (24%), and South Carolina (20%).

Severe convective storms, which can conjure tornadoes, hail, and other perils, have wrought damage across the U.S. in recent years, particularly in the Midwest and Great Plains states. These storms caused more than $52 billion in insured losses in 2025, the third-highest total on record, behind only 2023 and 2024.^[1]

In fact, excluding hurricane damages, 2025 was the most expensive year for major U.S. natural disasters. A pair of Los Angeles County fires accounted for $62 billion in economic damage, becoming the most expensive non-hurricane disaster in U.S. history.^[2]

Rising instances of severe weather have caused home insurance prices to soar in the 2020s. Since 2021, the average cost of home insurance has risen nearly three times as fast as inflation (46% vs. 16%). Climbing costs have fostered frustrations among homeowners, with more than one quarter saying they would drop their coverage if they could, according to a recent Insurify survey.

Severe weather risks are changing how insurers price and structure their policies. To minimize their claims exposure and mitigate further premium increases, insurers are shaping policies to shift more financial risk to homeowners.

In hurricane-prone areas, insurers often apply a separate hurricane deductible equal to 5% of the home’s dwelling coverage, which can easily cost homeowners $10,000 or more. In regions with frequent hail, insurers are moving away from covering roofs at replacement value. Instead, they insure roofs at actual cash value, which factors in depreciation and results in lower claims payouts.

To align home insurance premium data with this increased risk-sharing, Insurify updated its methodology in 2026 to reflect updated dwelling coverage values and peril-specific deductibles.

Insurify forecasts costs to continue rising in 2026, with certain states likely to absorb higher premium hikes than others. Insurify data scientists project California rates will rise 16% as insurers try to recover wildfire losses and implement more advanced risk modeling. Nebraska (13%), New Mexico (11%), and Georgia (10%) are also facing significant increases. Conversely, rates are likely to dip in five states by 0% to 2%: Hawaii, Massachusetts, Maine, Louisiana, and Rhode Island.

Key findings

• The average annual cost of home insurance rose 12% in 2025 to $2,948. Insurify projects the average will climb to $3,057 by the end of 2026, a further 4% increase.

• Since 2021, the average cost of home insurance has risen 46%, about three times as much as inflation (16%).

• Florida is still the most expensive state for home insurance. The typical annual premium ($8,292) is more than double the national average, following an 18% spike in 2025.

• Insurify projects California premiums will increase 16% by the end of the year, the largest anticipated hike for any state. To recover wildfire losses, insurers may ask for higher rate increases, but California’s strict regulatory system could constrain those increases.

• Minnesota home insurance rates surged by 34% in 2025, an increase of nearly $900, bringing the state’s average annual policy to $3,530.

• The affordability gap in premiums between high- and low-cost states widened in 2025. On average, premiums rose nearly three times faster in the 25 most expensive states for home insurance than in the 25 cheapest states (14% vs. 5%).

Top 10 most expensive states for home insurance by the end of 2026

The U.S. may not have experienced any hurricanes in 2025, but other forms of extreme weather generated losses in their place. Americans witnessed 23 billion-dollar disasters in 2025, the third most on record, behind only 2023 and 2024.

These disasters, coupled with more frequent but less severe weather events, have led to waves of home insurance claims in recent years. In at least four states, insurers spent more money on claims than they made in premiums in 2024. The following year, insurers raised average premiums in all but five states. 

Insurify projects that homeowners in 2026 will see more of the same, with the average annual cost of home insurance climbing 4% from $2,948 to $3,057. It could be worse. Americans benefited from the fact that 2025 was the first year in a decade without a landfalling hurricane in the U.S. If 2026 brings an active hurricane season, premiums could rise more sharply in 2027. 

For the most accurate representation of premium costs, Insurify bases rates and projections on each state’s typical dwelling coverage value for a single-family home. In other words, the estimated replacement cost of a standard home, excluding land value. A core factor in rate-setting, dwelling coverage values range from roughly $292,000 in Oklahoma to $500,000 in Hawaii in Insurify’s analysis.

Florida is unlikely to lose its position as the most expensive state for home insurance, with the average annual premium nearing $8,500 by the end of 2026, Insurify projects. Midwest and Great Plains states have shown more upward movement lately, as they’re highly exposed to convective storm effects, such as hail, heavy rains, and high winds, including tornadoes.

In 2025, severe convective storms narrowly overtook hurricanes to become the costliest driver of global insurer losses since 2000.

In 2025, the U.S. experienced 19 convective storm events that each resulted in more than $1 billion in insurer losses, the second most on record behind 2023. Many of these losses took place in Midwestern states, including the fourth and fifth most expensive convective storms globally since 1900 in terms of insured losses.^[1] In recent years, about half of all home insurance claims have come from either wind or hail, a consistent peril in the middle of the country.^[3]

While disasters are pulling homes down, inflation is making it harder to stand them up again. Home insurance premiums are tied, in large part, to the cost to rebuild a home. The price of building materials has jumped 15% in the past year. It had increased only 7% in the past two years combined.^[4]

1. Florida

• Projected annual cost by the end of 2026: $8,458 (+2%)

• Average annual cost in 2025: $8,292

• Typical dwelling coverage amount: $328,842

Florida remains the most expensive state for home insurance as a result of hurricanes, which can cause economic damages ranging in the hundreds of billions. The nine most expensive natural disasters on record in the U.S. have been hurricanes, according to Climate Central’s billion-dollar disaster database.^[2]

Following hurricanes Helene and Milton in 2024, Floridians filed about 300,000 home insurance claims.^[5] As insurers tried to recover losses, the average annual rate in Florida jumped 18% in 2025, to just under $8,300 per year, an increase of $1,252.

Some Florida homeowners may avoid more rate hikes in 2026. State insurance officials said the state-backed insurer of last resort, Citizens Property Insurance, will undergo an average rate decrease of 9%. The cut is the result, in part, of reduced financial exposure after moving many former policyholders to private insurers.^[6]

2. Oklahoma

• Projected annual cost by the end of 2026: $5,205 (+5%)

• Average annual cost in 2025: $4,962

• Typical dwelling coverage amount: $291,812

Oklahoma is likely to finish 2026 as the second most expensive state for home insurance, surpassing Louisiana. It’s a remarkable development for a state that doesn’t face the same hurricane risks as Gulf Coast states, and highlights the rising cost of severe convective storms.

These storms can bring rain, hail, lightning, straight-line winds, and tornadoes. In 2024, the last year with complete data, Oklahoma led the nation with 151 tornadoes and had the third-most hailstorms of any state (767).^[7] Insurance costs in the state jumped 24% in 2025.

In 2026, legislators voted down a bill that would have given insurance regulators the power to reject rate increases before they’re implemented. The measure would have marked a departure from the state’s current “use-and-file” system that allows insurers to enact hikes before filing them with regulators.^[8]

3. Louisiana

• Projected annual cost by the end of 2026: $5,035 (+0%)

• Average annual cost in 2025: $5,050

• Typical dwelling coverage amount: $298,283

Louisiana’s geography makes it highly susceptible to hurricane damage, and the state’s high average premiums reflect that risk. Rates surged 39% in 2024 but were flat in 2025. They could dip slightly in 2026 as the state continues putting resources toward disaster mitigation.

In May, the governor signed a bill that requires insurers to disclose older rates in renewal notices and seeks to tamp down excessive increases.^[9] The state also enacted a bill that creates a $10,000 state tax credit for homeowners who install specific storm-resistant roofs. That builds on top of the state’s existing Fortified Homes program, which also provides grants of up to $10,000 for certain roof upgrades.^[10]

4. Nebraska

• Projected annual cost by the end of 2026: $4,560 (+13%)

• Average annual cost in 2025: $4,028

• Typical dwelling coverage amount: $337,800

While natural disaster news tends to focus on the coasts, Nebraska is representative of the rising risks homeowners and insurers face in Great Plains states. High winds and hail are the main culprits.

In April 2025, Nebraska saw “softball-size” hailstones up to 4 inches in diameter, driven by winds up to 70 mph.^[11] In April 2024, a powerful tornado swept through suburban Omaha and damaged hundreds of homes — one of 99 tornadoes recorded in the state that year.^{[7] [12]}

High claim volume caused Nebraska insurers to spend $136 for every $100 they made in premiums in 2024.^[13] To realign their rates with their financial risk, insurers raised premiums by an average of 25% in 2025. Insurify expects an additional 13% rate hike in 2026 as insurers adjust to evolving weather conditions.

5. Texas

• Projected annual cost by the end of 2026: $4,529 (+3%)

• Average annual cost in 2025: $4,380

• Typical dwelling coverage amount: $326,004

Texas faces a full roster of natural disasters: hurricanes, wildfires, tornadoes, snowstorms, flooding, and hail, among others. Those threats have caused insurers to raise rates, with the average cost of home insurance increasing 14% in 2025, up to $4,380.

Although much of the state’s exposure is due to coastal hurricane vulnerability, Texas is also a hotspot for hail, which causes costly roof claims and repairs. In 2023 and 2024, Texas recorded over twice as many hail events as any other state.^[7] And Texas averages more than 100 tornadoes per year.

Texas is a file-and-use state, meaning insurers can impose rate increases before regulators review and approve them. In 2025, lawmakers considered a bill that would have partially altered this system so insurers would need prior approval before raising rates over 10% on home and auto insurance. However, that bill didn’t pass.^[14]

6. Colorado

• Projected annual cost by the end of 2026: $4,164 (+4%)

• Average annual cost in 2025: $3,996

• Typical dwelling coverage amount: $324,724

Colorado homeowners have faced some of the nation’s steepest rate hikes in recent years, though Insurify projects a more moderate increase in 2026. Since 2023, the average cost of home insurance has increased 55% as insurers try to recover losses from extreme weather.

Insurers paid out more money in claims than they made in premiums in 2023.^[15] Hail-producing convective storms are the biggest factor in rising premiums. Depending on the county, hail accounts for 26% to 54% of homeowner premiums. Wildfire risk represents 1% to 25% of premiums, according to the Division of Insurance.^[16] Of the state’s five largest fires on record, four have taken place since 2020.^[17]

7. Alabama

• Projected annual cost by the end of 2026: $3,979 (+1%)

• Average annual cost in 2025: $3,928

• Typical dwelling coverage amount: $329,117

Alabama remains one of the most expensive states for home insurance, with severe storms and high winds taking a toll on homeowners and insurers. Alabama sees an average of about 75 tornadoes each year.

In mid-February 2025, a strong storm traveled through the Southeast, spawning tornadoes in Alabama, Tennessee, and Mississippi and causing $1.6 billion in damages.^[2] On average, homeowners saw rates rise 15% in 2025 but face a milder 1% increase in 2026, according to Insurify projections.

8. Mississippi

• Projected annual cost by the end of 2026: $3,833 (+2%)

• Average annual cost in 2025: $3,743

• Typical dwelling coverage amount: $320,702

Mississippi homeowners have to keep an eye on hurricanes, tornadoes, and flooding. Despite these threats, the state has seen its average insurance costs fall 11% since the end of 2023. In that time, it has gone from the second most expensive state for home insurance coverage to eighth.

But Mississippi’s position on the Gulf Coast still puts it in danger of landfalling hurricanes, which can quickly upend a state’s insurance market. Additionally, Mississippi is the only Gulf Coast state without an active hurricane mitigation program for homeowners, after legislators pulled funding for an early version of a grant system for hurricane-related roof upgrades.^[18]

9. Minnesota

• Projected annual cost by the end of 2026: $3,654 (+4%)

• Average annual cost in 2025: $3,530

• Typical dwelling coverage amount: $407,360

Minnesota home insurers have raised rates an average of 64% in the past two years, the largest increase of any state. Since the end of 2023, Minnesota has gone from the 21st most expensive state for home insurance to the ninth most expensive.

The increases come as insurers lost money in 2022 and 2023, including spending $158 for every $100 made in premiums in 2022. That year was the costliest ever year for Minnesota storms, with over $6 billion in damage from hail and winds. In 2023, a hailstorm in the Twin Cities area caused another $1 billion in property damage.^[19]

More recently, Minnesota insurers had a much-improved financial year in 2024, so homeowners might dodge another significant rate hike in 2026.

10. Illinois

• Projected annual cost by the end of 2026: $3,559 (+5%)

• Average annual cost in 2025: $3,380

• Typical dwelling coverage amount: $416,267

Illinois is one of many Midwest states where storm activity is driving higher home insurance costs. In the summer of 2023, several rounds of storms generated hail 3 inches in diameter, with windstorms gusting at over 70 mph.^[20] That year, home insurance companies operating in the state spent nearly as much money on claims as they made in premiums ($97 spent for every $100 in premiums).

The following year, Illinois recorded 131 tornadoes, well above average and the second most of any state behind Oklahoma. Overall, the average cost of home insurance in Illinois is up 47% compared to 2023.

Citing extreme weather, the state’s largest home insurer, State Farm, raised rates by 27% in summer 2025. In response, Illinois lawmakers are considering legislation that would require insurers to reimburse consumers if regulators deem that their rate increases are excessive.^[21] Currently, the state has no authority to approve or deny rate changes. Illinois is a “use-and-file” state, meaning insurers can implement rate changes before filing them with regulators.^[22]

The 10 states that will see the largest cost increases in 2026

As insurers adapt to extreme weather, Insurify projects that 45 states and Washington, D.C., will see home insurance rates rise over the next 12 months. California, coming off a record-setting pair of wildfires in early 2025, faces the largest potential increase, at 16%. In central states like Nebraska and Missouri, historic storm volume is leading to costly wind and hail claims, ramping up insurer losses and causing them to raise rates in response.

1. California

• Projected average increase by the end of 2026: +16% (+$388)

• Projected cost by the end of 2026: $2,843 (up from $2,455 in 2025)

• Typical dwelling coverage amount: $488,000

Destructive wildfires are driving higher home insurance rates in California, with Insurify projecting a 16% increase, roughly $400, in 2026. Grouped together, the Palisades and Eaton fires from January 2025 are the most expensive non-hurricane natural disaster on record in the U.S.

Overall, the four most destructive fires in state history have all taken place in the past nine years, as high winds and drought-level dryness fuel fast-growing blazes.^[23] Large catastrophic losses lead insurers to raise premiums to remain on solid financial footing.

“If we were evaluating economic factors alone, a sharper increase in California home insurance premiums would be justified,” Insurify Senior Carrier Partnerships Manager Daniel Lucas said. “However, the state’s regulatory environment and the political pressures of an election year make it unlikely that rate increases will exceed 16%.”

Analysts say California has the strictest underwriting constraints on insurers of any state.^[24] Lately, however, state insurance regulators have allowed insurers to implement significant rate increases in exchange for insurers expanding coverage to high-risk areas that have few to no other options for insurance. Doing so helps reduce the financial exposure of the state-backed insurer of last resort, the FAIR Plan.

Since 2021, the number of policyholders on the plan has doubled to nearly 600,000. More policyholders means more potential for catastrophic loss, and insurers offset this higher risk with higher premiums. In October, plan administrators asked regulators to approve the largest home insurance rate hike in seven years, averaging 36%.^[25] That request is pending.

2. Nebraska

• Projected average increase by the end of 2026: +13% (+$532)

• Projected cost by the end of 2026: $4,560 (up from $4,028 in 2025)

• Typical dwelling coverage amount: $337,800

Nebraska rates continue to rise as a result of heightened storm activity in the state. Tornadoes and hail contribute to costly roof repairs, putting acute upward pressure on premiums. “Not only is this the most active tornado season on record, it does not even come close,” wrote a local meteorologist in 2024.^[26] Insurers spent 37% more on claims than they made in premiums that year.

State Farm, the state’s largest insurer by market share, spent 64% more on claims than it made in premiums. These figures strongly suggest insurers will raise rates in 2026 to maintain financial viability.

3. New Mexico

• Projected average increase by the end of 2026: +11% (+$246)

• Projected cost by the end of 2026: $2,524 (up from $2,278 in 2025)

• Typical dwelling coverage amount: $308,483

New Mexico home insurers raised premiums by an average of 18% in 2025, and Insurify projects additional rate hikes in 2026. Much of the increase is a result of heightened wildfire activity.

In the past four years, the state has recorded its two largest wildfires.^[27] The Calf Canyon/Hermits Peak Fire in 2022 was briefly the most destructive on record, destroying or damaging about 1,000 buildings, including hundreds of homes.^[28] Two years later, the South Fork Fire broke that record with 1,400 structures damaged or destroyed.^[29] The state also has the second-highest rate of uninsured homes, at 23%.

4. Georgia

• Projected average increase by the end of 2026: +10% (+$288)

• Projected cost by the end of 2026: $3,167 (up from $2,879 in 2025)

• Typical dwelling coverage amount: $369,910

Georgia may have less coastline than neighboring states, but homeowners still have to worry about large-scale hurricane damage. In 2024, insurers paid out more than 165,000 total claims in response to Hurricane Helene. That year, the cost of home insurance claims exceeded the amount insurers made in premiums, causing them to raise rates in 2025. From December 2024 to December 2025, home insurance rates in the state rose an average of 9%, and Insurify projects an additional 10% increase in 2026.

5. South Carolina

• Projected average increase by the end of 2026: +9% (+$278)

• Projected cost by the end of 2026: $3,370 (up from $3,092 in 2025)

• Typical dwelling coverage amount: $336,243

South Carolina homeowners have to watch out for several types of weather threats. The state ranks among the top 10 in expected financial losses from hurricanes, earthquakes, and ice storms. The state’s position on the Atlantic Coast puts it at high risk of wind damage.

In 2024, hurricanes Helena and Debby generated 29 tornadoes within the state. The following year, the average cost of home insurance rose 20%.^[30] Rates could rise an additional 9%, nearly $300 for the average policyholder, in 2026 as insurers continue to bring premiums in line with risk.

6. Missouri

• Projected average increase by the end of 2026: +7% (+$209)

• Projected cost by the end of 2026: $3,035 (up from $2,826 in 2025)

• Typical dwelling coverage amount: $341,009

In recent years, Missouri homeowners have paid above-average premiums for home insurance, and they’re likely to see costs increase by 7% in 2026. From 2020 to 2024, 41 billion-dollar disasters affected the state, tied for the third most nationwide.

Those risks have crescendoed recently. Missouri reported 105 tornadoes in 2024, one shy of the state record. In May 2025, St. Louis experienced its first deadly tornado in nearly 70 years, killing four and causing $1.6 billion in damage. Over the course of 2025, insurers raised home premiums by 9%, and they’re likely to request additional rate hikes in 2026.

7. Arkansas

• Projected average increase by the end of 2026: +7% (+$216)

• Projected cost by the end of 2026: $3,345 (up from $3,129 in 2025)

• Typical dwelling coverage amount: $311,941

Arkansas is one of the least affordable states for home insurance nationally. It’s one of six states where home insurance costs make up more than 20% of the typical monthly housing payment.

Strong winds are becoming more of a problem for homeowners and insurers. The state previously averaged 37 tornadoes per year, but recorded 107 in the past two years. In March 2025, one tornado outbreak generated four twisters deemed EF-3 or stronger, the most in a single Arkansas outbreak since 1999.^[31]

To mitigate rising rates and climate risks, Arkansas recently established the Strengthen Arkansas Homes Program, a model other states have embraced, providing grants to homeowners to fortify their homes against catastrophic windstorms.^[32]

8. Oregon

• Projected average increase by the end of 2026: +6% (+$86)

• Projected cost by the end of 2026: $1,571 (up from $1,485 in 2025)

• Typical dwelling coverage amount: $395,182

High winds and extreme heat sparked Oregon’s worst wildfire season on record in 2024, burning 1.9 million acres across the state.^[33] Conversely, extreme cold also afflicts some Oregon homeowners. In January 2024, a winter storm caused hundreds of thousands of residents to lose power. Frozen pipes burst, and tree branches falling under the weight of snow damaged and even destroyed homes.^[34]

Oregon homes ended up costing insurers more money than most states in 2024, and Insurify projects insurers will look to increase rates by about 6% in 2026.

9. Illinois

• Projected average increase by the end of 2026: +5% (+$179)

• Projected cost by the end of 2026: $3,559 (up from $3,380 in 2025)

• Typical dwelling coverage amount: $416,267

In the past two years, Illinois has gone from the 19th most expensive state for home insurance to the 10th. Insurers are likely to seek higher premiums in 2026, as well.

As severe convective storms become a larger part of the U.S. insurance crisis, Illinois is feeling the weight of increased tornado activity. In spring 2023, a significant tornado outbreak hit Illinois and neighboring states. That outbreak caused 37 tornadoes in Illinois in just over one day, one of which caused a northern Illinois theatre to collapse during a concert.^[35] The following year, a larger July outbreak set a state record, with 48 tornadoes in a single weather event.

10. Oklahoma

• Projected average increase by the end of 2026: +5% (+$243)

• Projected cost by the end of 2026: $5,205 (up from $4,962 in 2025)

• Typical dwelling coverage amount: $291,812

Oklahoma homeowners are in line to see higher rates in 2026, following an eventful weather year in 2025. On March 14, gusts of up to 83 mph in critically dry conditions led to 130 fires, one of the worst single-day wildfire outbreaks in state history. Those fires burned hundreds of homes and structures. Two months later, a multi-day tornado outbreak generated hail as large as 4.5 inches in diameter. That summer, the state experienced 42 tornadoes, the most of any summer on record.^[36]

Six states saw premiums soar by 20% or more in 2025

The average U.S. homeowner paid 12% more for insurance in 2025, but much of that increase was concentrated in a handful of states, particularly in the Great Plains and Midwest. Notably, Insurify analysis shows the cost gap widened between more and less expensive states in 2025. Premiums increased about three times faster in the 25 most expensive states for home insurance than in the 25 cheapest states (14% vs. 5%).

Minnesota underwent the largest rate increase, 34% (+$898), raising the average annual premium to $3,530. Just five states saw rates fall or remain flat. North Carolina saw rates fall 6%, the most of any state, while neighboring South Carolina averaged a 20% increase.

Of the six states with increases of at least 20% in 2025, all except Iowa are now more expensive than the national average. And Iowa could join that club soon. The average cost of home insurance in the state has gone up 54% in the past two years, the third-largest upswing behind Minnesota and Colorado.

State	Change in Cost in 2025	Average Annual Cost, End of 2025	Average Annual Cost, End of 2024
U.S. Average	12%	$2,948	$2,636
Minnesota	34%	$3,530	$2,632
Colorado	33%	$3,996	$3,032
Iowa	28%	$2,802	$2,194
Nebraska	25%	$4,028	$3,212
Oklahoma	24%	$4,962	$3,986
South Carolina	20%	$3,092	$2,581

Since 2023, rates have risen fastest in the central U.S. 

In the past two years, seven states have seen their costs jump by more than 35%. Most of them are in the middle of the country, like Iowa or Michigan, illustrating how climate-driven extreme weather isn’t confined to the East and West Coasts. Severe convective storms produce high winds and hail that can cause extensive property damage. And 2025 was the third consecutive year in which these storms caused insurers more than $50 billion in losses.^[1]

How California and Florida are each dealing with their own insurance crisis

California and Florida command the national spotlight when it comes to home insurance and natural disasters. They rank as the two states with the highest potential for financial damage from natural hazards, according to the National Risk Index (NRI).^[37] Both states have seen rising rates of non-renewals, when insurers decline to renew existing policies, often in areas prone to extreme weather. This reduced competition for policies has downstream effects, including upward pressure on premiums.

California looks to balance costs and access to coverage

The Palisades and Eaton fires in January 2025 have fixed the industry’s focus on California insurers and insurance regulators. Even before those blazes, the state had been grappling with insurers declining to renew at-risk properties. At one point, seven of the state’s 12 largest home insurance companies had either limited their business or withdrawn from California altogether.

Then came the two most expensive fires in world history, in terms of insured losses. The Palisades and Eaton fires rang up $23 billion and $18 billion in losses, respectively. In response, many insurers filed requests for rate increases. State Farm, the state’s largest home insurer, originally requested an average 22% increase, which they later reduced and had accepted at 17% — followed by the insurer requesting a further 11% increase.

The California Department of Insurance has implemented reforms as it seeks to keep insurers in the state, mitigate rate hikes, and expand coverage to high-risk areas.

In 2025, California began letting insurers use more advanced computerized catastrophe modeling in their underwriting if they agree to write more policies in underserved regions. More recently, the state gave two insurers approval to raise rates by an average of 6.9% for 1.1 million policyholders in exchange for writing more policies in wildfire-prone areas. Rate increase requests above 7% can trigger a public hearing, according to state insurance regulations, which often delays implementation.^[38]

In 2024, California saw its average rate climb 10%, followed by a 5% increase in 2025. Los Angeles County enters 2026 as the most expensive county for insurance in the state, with an average annual cost of $4,173.

Florida insurance reforms are taking shape

Florida is another state where severe weather and natural disasters are restructuring the insurance industry. Although the state can’t legislate away its climate risk, it has implemented other reforms to help manage its insurance crisis.

Legislation from 2021 to 2023 sought to cut down on frivolous lawsuits that drive up insurers’ litigation costs and, consequently, homeowners’ premiums. Since then, 17 insurers have started doing business in the state, increasing competition for policies.

The state also ramped up its efforts to move policyholders from the state’s public-backed insurer of last resort, Citizens Property Insurance, to private insurers. Since late 2023, the number of Citizens policyholders has dropped from over 1 million to about 400,000.^[6] That reduced exposure allowed Citizens to announce a 9% average rate cut in January.

A decline of more than 30% in lawsuits has put insurers on better financial ground. Despite $20 billion in insured losses from Hurricane Milton, 2024 was the first year Florida domestic property insurers turned a clear collective profit since 2016, according to Gallagher Re.^[39]

Nevertheless, Florida’s inherent geographic risk keeps premiums more expensive than in other states. Premiums are highest in the southern part of the state, where hurricanes threaten high concentrations of expensive homes. The most expensive counties are Monroe ($22,436), Miami-Dade ($15,715), and Palm Beach ($14,235).

Tips: How homeowners can save money on insurance premiums

Extreme weather and inflation are likely to continue pushing up home insurance rates for years to come. An Insurify survey found that 60% of homeowners expect their rates to increase in 2026.

“Homeowners nationwide are looking for predictability, not surprises, when it comes to their insurance costs,” said Mallory Mooney, director of sales and service at Insurify. “Given rising rates, some homeowners and insurers are getting creative. We’re seeing more interest in premium-locking programs that guarantee consistent premiums over three years for a small fee. That type of stability is in high demand in an era when insurance premiums have risen 36% in the past three years.”

Before buying or renewing a policy, homeowners should use all the tools at their disposal to make sure they’re getting the best possible deal.

• Comparing quotes: Industry experts and insurance regulators frequently cite the benefits of comparing policy quotes among different insurers. Insurify previously found a cost difference of up to 47% between the cheapest and most expensive insurers for a property of equal value.

• Improving their credit: A weak credit history leads most insurers to believe you’re more likely to file a claim. A minority of states limit the use of credit history in insurance underwriting, but in most states, a homeowner with excellent credit can pay up to 26% less for a similar policy.

• Checking for discounts: Homeowners shouldn’t underestimate the range of discounts insurers offer. While many people may have heard of discounts for customer loyalty or bundling policies, fewer may know that discounts are available to retired seniors or for paying their annual premium in full.

Depending on their location, homeowners may also be eligible for government grants and insurance discounts for hardening their homes against extreme weather. In fact, 10 states require insurers to provide discounts to homeowners who upgrade their roofs to certain standards to better withstand high winds.^[1]

Methodology

Insurify’s data science team leveraged both their real-time database of home insurance quotes from partner carriers, as well as aggregated rate filings from Quadrant Information Services, to determine the state of home insurance in 2026.

From their proprietary quotes database, Insurify gathered the average dwelling coverage limit needed to cover a home in every state. Unless otherwise noted, average insurance rates in each state reflect the median cost of an HO-3 policy with that state’s average dwelling coverage limit, a liability limit equal to 75% of that dwelling limit, standard personal property and loss of use limits, a 5% wind/hurricane deductible, a 2% hail deductible, and a $1,000 deductible for all other claims. Costs assume homeowners with good credit and zero claims within the past five years, living in a single-family frame house.

Insurify gathered Quadrant rates in every county in the U.S. to assess the state of insurance rates throughout 2025. Statewide costs reflect the median rate for home insurance across every county in that state, weighted for each county’s population.

Yearly prices reflect rates at the end of a given year. To project how home insurance rates will change in 2026, Insurify data scientists looked at the historical relationship between a state’s recent industry-wide home insurance loss ratios and subsequent rate movement. Based on the NAIC’s latest home insurance loss ratio data, they then projected how much rates will change in every state in 2026.

Inflation statistics use the Consumer Price Index for All Urban Consumers (CPI-U) for all items, seasonally adjusted, showing an increase from 290.9 to 326.0 from December 2021 to December 2025.