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Home insurance premiums rose faster than home values since 2019
Premiums climbed 62% from 2019 to 2024, outpacing a 50% median rise in home prices, as rebuilding costs and catastrophe losses drove coverage higher.
Homeowners have increasingly seen renewal notices that demand higher premiums, but the drivers are not simply rising home values, according to analysis published by Insurance Business.
Between 2019 and 2024, median U.S. home prices rose about 50%, from $271,900 to $407,500, based on National Association of Realtors data compiled by the Housing Almanac. Over the same period, homeowners actually paid 62% more for insurance, using a Federal Reserve Bank of Dallas analysis of ICE McDash mortgage data covering roughly two-thirds of the U.S. mortgage market.
The gap reflects costs that push dwelling coverage limits higher and then translate into premiums, even when housing inflation is more muted. Insurance Business cites Verisk findings that reconstruction costs rose a cumulative 55% between 2020 and 2023, then moderated but remained elevated at 5.2% in the year to July 2024, independent of home price moves.
Catastrophe experience has also deteriorated for insurers, with reinsurance rates rising 107% before beginning to ease. The Dallas Fed analysis shows insurer losses roughly doubled between 2019 and 2024, driven by more frequent and severe hurricanes, wildfires, floods, and convective storms, while the article notes the January 2025 Los Angeles wildfires destroyed roughly 12,000 homes and triggered more than $22 billion in wildfire claim payouts.