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Once a routine budget item, home insurance premiums have ballooned into a major pressure point for many homeowners.
After a 47% spike between 2020 and 2025, the average U.S. premium is up to $200 a month, but ranges from $77 in Vermont to $463 in Colorado, according to a recent LendingTree analysis. Homeowners in 17 states now spend more on insurance than property taxes, LendingTree found. For 44% of people surveyed by SoFi, it even rivals the mortgage itself.
Homeowners are absorbing a major shift in the insurance market: Climate disasters have gotten far more severe, and repairing the damage costs more too. Higher premiums also complicate the math for prospective buyers, many of whom are struggling to afford 6%+ mortgage rates and inflated real estate prices.
“Insurance used to be an afterthought in the homebuying process,” said Rob Bhatt, a LendingTree insurance analyst. “In many areas today, the rising cost of home insurance is having an outsized influence over people's buying power.”
Highs and lows across the nation
Hard to capture in averages, the insurance landscape is more complicated than any one snapshot suggests. For instance, LendingTree estimates that insurance accounts for 8.5% of the typical U.S. homeowner's monthly housing payment: $200 of a $2,354 payment that also includes $1,843 for the mortgage and $311 on property taxes.
But in many states, insurance is a bigger chunk of housing payments, and in others — including California — it's as little as 2%-4%.
Take Nebraska, Oklahoma, and Texas, which all face frequent hailstorms, thunderstorms, and tornadoes. Insurance accounts for 19%, 18% and 14% of monthly payments in those states, making it a bigger burden than anywhere else.
In fact, between 2019 and 2024, rates in certain disaster-prone areas increased 25% or more even after adjusting for inflation, according to a study by the Government Accountability Office. That compares to just 3% nationwide.
On the other hand, states like Maine and Vermont are less prone to natural disasters, and in turn, weather-related claims. But rates may still reflect post-pandemic increases in the cost of construction materials and labor, which make it more expensive to rebuild a home.
In other words, the impact varies: 71% of homeowners in a recent Pew Research survey said their insurance costs have gone up over the last few years, but only 42% said it was by a lot.
And keep in mind that property taxes and home values vary widely, complicating the insurance-to-payment ratio. For example, Hawaii's is only 2.1% — not just because insurance is less expensive, but because it has the highest overall mortgage costs.
What to do
While the overall pace of rate increases slowed in 2025 — a trend forecasters are expecting will continue — insurance has become a tough pill to swallow. In a February survey, almost half of homeowners said they would have a hard time affording their mortgage if their premiums went up in the next year, according to The Zebra, an online insurance marketplace.
To limit your own extra costs, consider these steps:
Shop around at every renewal. Some insurers may offer special discounts to long-term policyholders, but it's worthwhile to compare rates periodically to see whether your premium still holds up. While you're at it, ask about discounts for bundling your home insurance with other coverage you need, like auto or liability.
Raise your deductible. As with other types of insurance, premiums tend to be lower when you sign up to cover more of the cost of a claim yourself. Raising your deductible to $1,000 from $500 could lower your premium by as much as 25%, according to the Insurance Information Institute. (If you live in a disaster-prone area, your policy may have a separate deductible for certain kinds of damage, like from wind or hail.)
Prevent or avoid claims. Adding fire, smoke or burglar alarms may earn you discounts on your premium. (Before investing in any new systems, however, find out what kind your insurer recommends and how much you'd save.) And if something does go wrong, weigh whether to file a claim with insurance. A stretch of claim-free years often earns a discount of its own.
Harden the home against big disasters. Impact-resistant roofs, storm shutters, and impact-rated windows can also lead to discounts on your rate and can help prevent damage. Several states offer financial assistance to help make homes more resilient.
Mind the flood gap. Standard policies exclude big-ticket disasters, including flooding and earthquakes. Special coverage may be worth the additional cost for the peace of mind, depending on where you live.
Soft-apply before you buy. Get an insurance quote before you make an offer on a house, not after. You don't want to get caught unable to find or afford the coverage you need.
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