Why Homeowners Insurance Has Gotten So Very Expensive

Hundred-dollar bills folded in the shape of a house.

(Image credit: Getty Images)

By Karl Susman, CPCU, LUTCF, CIC, CSFP, CFS, CPIA, AAI-M, PLCS

published 11 April 2025

You may have noticed a trend that is making it more difficult and more expensive to insure your home. So what is up with homeowners insurance? Why is it getting so difficult to buy, and why is the price going up, up, up and away?

Homeowners insurance — or property insurance, as those of us in the industry also refer to insurance that encompasses homeowners insurance, condominium owners’ policies, landlords’ policies and renters’ policies — is seeing a titanic shift that we are all feeling.

Ready? Set? Climate change!

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Whether you believe climate change exists or not, what isn’t in dispute is that the insurance industry is seeing more frequent and bigger claims across our great nation because of weather, wildfires and other natural disasters.

We have tornadoes, floods and hurricanes in the South; tornadoes, earthquakes, blizzards and floods in the Midwest; wildfires, dust storms, floods and earthquakes in the West; and hurricanes, nor’easters, blizzards and wildfires in the East.

Oh, and let’s not forget volcanoes erupting in Hawaii and possibly Alaska, landslides in California and droughts that come and go all over the U.S.

And the disasters are more frequent than ever

Would it surprise you to know that these events are more and more frequent? Not only that, but when they occur, they are packing a stronger punch.

Don’t just take my word for it — check in with the National Oceanic and Atmospheric Administration. You can find the same frightening information over at the World Meteorological Organization sounding the alarm.

It is happening, people, like it or not, believe it or not. It reminds me of a T-shirt I saw once that said that science doesn’t care what you believe.

Here are some startling numbers, courtesy of the Insurance Information Institute:

Losses paid from catastrophes in 2004-2013: About $65 billion ($104 billion in 2025 dollars).

Losses paid from catastrophes in 2014-2023: $773 billion. Yes, that’s more than seven times the losses in 2004-2013. What’s more, $320 billion of those losses happened in 2017-2023 alone.

See the trend? Up, up, up, more, more, more!

How this translates to more expensive insurance

If your insurance company is paying more money, your premium is going to be higher. They need your money to pay claims when they come, after all. So more claims and more expensive claims mean higher premiums for us all.

Paying more for insurance is a double whammy. One, we have to pay more out of our pockets for the protection that we need. Two, we’re all experiencing more losses — and significantly more damaging ones at that.

Keep your eyes open for ways to protect your home, because the only thing we can do to try to keep our premiums down is to lower the risk of having a loss in the first place.

To find out how to protect yourself from losses caused by disasters, see the Kiplinger article How to Protect Your Home from Natural Disasters With the Right Insurance.

That article also includes information on how to prepare your house to withstand anything that nature can throw at it, often referred to as home hardening, a process that could get you a break on your home insurance premiums.

And, finally, check out today's article Home Insurance: How to Cut Costs Without Losing Coverage for tips on keeping your costs down without dropping your insurance.

Want to learn more about insurance? Visit KarlSusman.com.

Disclaimer

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

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Karl Susman is an insurance agency owner, insurance expert witness in state, federal and criminal courts, and radio talk show host. For more than 30 years, Karl has helped consumers understand the complex world of insurance. He provides actionable advice and distills complex insurance concepts into understandable options. He appears regularly in the media, offering commentary and analysis of insurance industry news, and advises lawmakers on legislation, programs and policies.