Why are my Home Insurance prices increasing so much?  

farmers home insurance

Clients are asking this question more frequently so decided to answer it as a short bullet point blog post.

How much have home insurance rates increased?

According to an analysis of US national policy renewals from May 2022 to May 2023, home insurance premiums were up an average of 21% (reference: Policygenius report). In California they were up 11%.

What are the main causes of these increases in your home insurance rates?

  • Rising construction costs & inflation cause insurers to pay more for labor and materials, and they therefore may increase your rates. For more detail on construction inflation see this blog post HOA Insurance Megatrends.
  • More extreme weather events such as hurricanes, tornados and floods have caused significant damage to homes and resulted in more and higher insurance claims and rates.
  • More extreme natural disasters such as wildfires and earthquakes have caused significant damage to homes, leading to higher insurance claims and rates.
  • Changes in your home’s risk profile such as new fire risk maps (see this blog post Wildfire Zone? See How Close You are to One) on the new CA fire risk maps), resulting in higher (or lower) insurance rates.

What’s likely to happen next?

Home insurance rates are expected to continue to increase in 2024 due to continuing pressure from all the above factors. In 2025 I expect premiums to stabilize.

What can I do to lower my premiums?  

If you haven’t done these already consider:

  • Asking for discounts, for example see this video blog Insurance Discounts
  • Bundling your home and auto insurance policies
  • Increasing your deductible
  • Shopping around for a new insurance provider – let us review your policy and suggest other potential ways to save or simply call us for a quote
  • Minimize claims through systematic maintenance, for instance is there a defensible zone around your home with no flammable materials, do you clean out your dryer vents each year (dryer vent fires account for 78% of appliance fires), are your sewer lines inspected/snaked annually (a $150 plumber visit may save you a $20,000 back up of a Toilet claim)
  • HOAs have some other options too – see this blog post HOA Insurance Megatrends for more details.

Please call us right away for a coverage review and a quote on your home insurance. Farmers Insurance and other carriers we use have great coverage and prices!