As if owning a home wasn’t a big enough expense already, homeowners insurance rates are soaring to new heights.
Average premiums hit $2,802 per year in July 2025, according to a new report from insurance marketplace The Zebra. But that’s just a nationwide average: In some states, rates are creeping up toward $8,000.
Inflation, tariffs, government regulations and labor shortages have all contributed, experts say, but climate change has emerged as the chief culprit.
“One of the big things we’ve seen in the last five, ten years is the growing frequency of weather events in parts of the country,” David Seider, The Zebra’s chief commercial officer, told CNBC Select. “Hail, tornadoes, flooding — storm damage has become a pivotal piece of policy calculations.”
Insurance premiums are rising 8.7% faster than inflation, according to the site’s findings.
Who’s paying the most for homeowners insurance?
The cost of residential property insurance looks very different across the U.S., but the states paying the most aren’t the usual suspects.
The five most expensive states:
- Nebraska: $7,920
- Oklahoma: $7,426
- Kansas: $5,303
- Arkansas: $5,080
- Colorado: $4,586
The five least expensive states:
- Hawaii: $721
- Vermont: $1,159
- Delaware: $1,225
- New Hampshire: $1,343
- Oregon: $1,430
Washington, D.C., is among the least expensive regions, according to Zebra, with annual premiums averaging just $1,399.
The most expensive place in America for homeowners insurance is Wrightsville Beach, North Carolina, about six miles from Wilmington. Because of the risk of hurricanes and flooding there, annual premiums average $13,760 — nearly five times the national average.
States challenge rising rates
Some states are pushing back: After State Farm announced in July that it was raising premiums in Illinois by an average of 27.2%, Gov. JD Pritzker called on lawmakers to beef up the Illinois Department of Insurance’s ability to reject excessive rate hikes.
His message came two months after Louisiana Gov. Jeff Landry signed a bill extending Insurance Commissioner Tim Temple’s regulatory authority.
But saying no to rising premiums could turn into a dangerous game of chicken, Seider said, with homeowners ultimately losing out.
“If an insurer’s rate increase is denied... they’ll stop offering policies in that state,” he added.
Farmers, Progressive and State Farm have all either stopped issuing or pulled back drastically on issuing new policies in Florida, while Allstate, Chubb, Nationwide and others have cut or curtailed coverage in California.
“They can’t go back to the loss ratios they had in the pandemic,” Seider said. “If they can’t underwrite profitably, I don’t think they’ll write policies at all.”
2. Ask about discounts
Comparison shopping is always a good idea, Seider said, but find out what discounts your current carrier has first.
“There are so many discounts,” he added. “You can get a loyalty discount, a discount for paying in full, for not smoking or for living in a gated community.”
Bundling, or buying more than one line of insurance from the same carrier, is the surest way to save. Amica offers discounts of up to 30% for purchasing both auto and home insurance, the largest bundling discount we’ve found.
3. Make your home safer
A burglar alarm can save you money on premiums, but an actively monitored security system will lower your rates even more. The same is true for smoke detectors and sprinkler systems.
Wind-resistant features like storm shutters, roof clips and impact-resistant glass can also get you a discount, especially if you live in a hurricane-prone region.
4. Raise your deductible
Your deductible is the amount you have to pay out of pocket for repairs before your insurance will pay on a claim. Raising your property insurance deductible from $500 to $1,000 can save you as much as 25% a year, according to the Insurance Information Institute.
Only increase your deductible if you can comfortably afford the difference when filing a claim.
5. Improve your credit score
In most states, carriers can consider your credit history when calculating your insurance premiums. The average homeowners premium for someone with excellent credit is $2,260, according to The Zebra, while someone with poor credit will average $7,260 (That’s a difference of 221%).
By raising your credit score by one category, you can save an average of 32% on your premiums.
If you’ve been turned down for homeowners insurance
You can be rejected for homeowners insurance for any number of reasons, including a bad credit score, your previous claims history or the crime rate in your area.
If your region is prone to natural disasters, ask your neighbors which carrier they use. If you’re a new homeowner, your real estate agent should be able to tell you who previously insured the property.
More than 30 states offer subsidized Fair Access to Insurance Requirements (FAIR) plans, which enable high-risk homeowners to get coverage —although with considerably higher premiums.
If you’ve received several rejections, you may be approved by an excess and surplus line company. Their policies usually come with more exclusions and higher deductibles, but they cover high-risk properties.
“The excess and surplus market is filling up,” Seider said. “These folks specialize in markets and policyholders that others won’t touch.”
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