Buying a home is one of the biggest purchases most people make — and homeowner’s insurance is the safety net that protects that investment. It helps pay to repair or rebuild after covered damage, protects personal belongings, and provides liability coverage if someone is injured on your property. Lately, however, those premiums have been moving up, and buyers need to plan for that recurring cost when they build their budgets.

Below is a clear look at why premiums are rising, how the pace of increases is changing, and practical steps buyers can take now to manage the cost.

Several forces are pushing homeowner insurance prices higher. Severe weather events and other natural disasters are occurring more frequently, which leads to more insurance claims. At the same time, the cost of materials and labor used to repair or rebuild homes has increased. Put simply, insurers are paying out more on claims, and those higher claim costs translate into higher premiums for policyholders.

That trend shows up in recent annual increases: according to industry tracking cited here, insurance costs rose about 14% per year in 2023 and 2024, then ~10% in 2025, with expectations of roughly 8% increases in 2026 and 2027. While the rate of growth appears to be slowing, premiums are still climbing — and that makes homeowner’s insurance an important and growing line item to account for in your long-term housing budget.

How much you’ll pay depends heavily on where you buy, the home’s price and condition, and the coverage limits and deductibles you choose. State-by-state averages vary, so local conditions — exposure to storms or wildfires, regional rebuilding costs, and local claims history — will influence your premium. That means homeowners in some areas will see notably higher insurance bills than others.

There is a partial offset to keep in mind: mortgage rates have been easing, which reduces monthly financing costs. As Michael Gaines of Cardinal Financial points out, rising taxes and insurance create pressure, but lower rates and the right loan program can still make homeownership workable. In other words, while insurance is an increasing expense, lower borrowing costs can help balance the household budget when planned together.

Because insurance becomes a recurring expense after closing, it’s important to factor it into affordability calculations up front. Here are practical measures that can help keep premiums down:

1. Shop around. Compare quotes from multiple insurers rather than accepting the first offer.

2. Bundle policies. Combining home and auto insurance often produces discounts.

3. Ask about discounts. Insurers may offer savings for safety features, claims-free histories, or other qualifications.

4. Highlight upgrades. Improvements such as a newer roof or storm-resistant windows can lower premiums by reducing replacement risk.

5. Improve your credit. A stronger credit profile can translate into better insurance pricing in many markets.

These steps — drawn from guidance by Insurify and NerdWallet — don’t eliminate the cost, but they can meaningfully reduce what you pay and give you more control over that line in your monthly budget.

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Bottom line

Homeowner’s insurance costs are rising due to more frequent severe weather and higher repair costs, though the pace of increase is slowing compared with the recent peak years. Because premiums vary by location and coverage, include realistic insurance estimates in your affordability plan and shop smartly to find the best pricing and discounts.

💼 If you’d like help estimating insurance and total monthly costs for homes in our local market, let’s connect — we can run the numbers together so you know what to expect at closing and beyond.