What’s happening with home insurance rates
Homeowners across America are seeing big changes in their insurance bills. According to new data from S&P Global Market Intelligence, insurance companies raised their rates by an average of 10.2% in 2024. That’s on top of a 12.7% increase in 2023. When you add these numbers together, many homeowners are paying about 24% more than they did just two years ago.
Who’s rising the insurance rates the most
American Family Insurance leads the pack with a 16.5% increase in 2024. They raised rates in 42 states, with Missouri seeing the biggest jump at 30.1%. Liberty Mutual comes in second with a 14.5% increase, while Progressive rounds out the top three with a 13.5% bump. According to the Insurance Information Institute, these increases are largely due to rising repair costs and more frequent natural disasters.
Where are rates climbing the fastest
Nebraska homeowners felt the biggest pinch, with rates climbing 22.7% in 2024. In fact, 33 states saw double-digit increases. The Consumer Federation of America, reports that states prone to severe weather events are experiencing the steepest rate hikes.
Why rates are going up
Several factors are pushing rates higher: Rising construction costs mean it costs more to repair or rebuild homes. According to Insurance Times, there’s also been significant improvement in profitability, with homeowners insurance showing a 13.8-point improvement in loss ratios during the first nine months of 2024. This improvement came despite challenges like Hurricane Helene. Natural disasters like hurricanes and wildfires are happening more often, with AM Best noting that Hurricane Milton in the fourth quarter is expected to have an even greater impact than Helene on homeowners results. Insurance companies are also paying more for their own insurance (called reinsurance). All these costs get passed down to homeowners..
Some good news
Not all companies raised rates by the same amount. USAA had the smallest increase at 3.1% in 2024. State Farm, the largest home insurer in America, kept their increases lower than average at 10.5%. Over the past six years, they’ve had the smallest total increase at 24.1%.
What you can do
Understanding these changes is important, but knowing how to respond is even more crucial. That’s where Vargas & Vargas Insurance can help. Our team of experts can review your current coverage, explain your options, and help find ways to save money while keeping your home properly protected. Don’t navigate these rate changes alone – call us at 617-298-0655 for a personalized consultation.
