Insurify, a leading insurance data and comparison platform, has released projections indicating that homeowners insurance premiums will rise by an average of 8% in 2025. Industry experts are sounding the alarm, warning that this upward trend is not only driving up mortgage delinquency rates but also adding significant pressure to household budgets that are already stretched thin.
Joel Berner, a senior economist at Realtor.com, stressed the critical role of insurance in homeowners’ monthly financial obligations. “Insurance is a non-negotiable component of monthly housing costs that must be accounted for in budgets,” Berner explained. He noted that the anticipated premium increases will make homeownership far more financially burdensome—affecting both prospective homebuyers, who face higher entry costs, and existing homeowners, who must allocate more of their income to insurance payments.
The impact of rising premiums extends beyond individual households to professionals within the housing industry. Toby Wells, president of Cornerstone Servicing—a firm that provides mortgage servicing and loss mitigation support—highlighted the challenges faced by servicers. “Higher insurance premiums directly increase our operational costs, particularly in areas like loss mitigation,” Wells said. “To avoid further eroding housing affordability for borrowers, we’re forced to closely scrutinize and manage our service fees, which creates additional operational strain.”
In response to the growing crisis, advocacy efforts have gained momentum. Trade associations representing homeowners, lenders, and housing industry professionals have launched lobbying campaigns targeting state-level policymakers. Their goal is to push for regulatory changes that address the root causes of premium hikes and provide relief to homeowners.
Two states at the forefront of insurance-related challenges—California and Florida—have already taken action. Both states have implemented meaningful regulatory reforms aimed at curbing excessive premium increases and easing the financial burden on homeowners. These changes include measures to enhance oversight of insurance carriers, streamline claims processes, and expand access to more affordable coverage options.
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