Can Your Homeowners Save on Skyrocketing Insurance Costs?

By Melissa Dittmann Tracey

Owning a home is getting more expensive—and it’s beyond just affording the mortgage. Rising costs for repairs, property taxes and homeowner’s insurance are putting pressure on homeowners across the country. Insurance premiums have jumped 24% nationwide since 2021, and in some states, they’ve nearly doubled. From wildfires and storms to inflation and climbing repair costs, homeowners are feeling the pinch from these rising insurance bills—and some buyers are even walking away from deals because of it.

To help homeowners navigate these challenges, Travis Hodges, the managing director of VIU, a digital insurance brokerage platform from HUB International, offers practical tips for saving money, avoiding costly mistakes and making sure a home is properly protected when it comes to insurance.

With rising insurance costs, has it become more of a deciding factor in real estate transactions?

HODGES: Absolutely. Rising interest rates have made every part of a monthly mortgage payment more critical, and insurance is a big piece—sometimes up to 20% of that payment. Any relief a homeowner can get on that is huge, especially since property taxes aren’t going down.

Twenty percent is a lot! What’s the average insurance payment these days?

HODGES: Nationally, it’s about $2,200 a year—or roughly $190 a month. But it varies widely depending on where you live. In Florida, for example, that number can easily double.

What’s driving these increases?

HODGES: A few things: Weather-related losses are unpredictable and happening in places that historically didn’t see them—like a tornado in Chicago. Property values have also skyrocketed since the pandemic, so the homes being insured are worth more, which raises premiums. Back in 2022-2023, year-over-year increases of 15-17% with insurance were common—which is substantial. Over the last 18 to 24 months, it’s been about a 10% bump in your premium—so that can seem like a bargain in comparison.

Can buyers know in advance which homes will be more expensive to insure?

HODGES: Definitely. Technology has made this easier. If you’re working with an [insurance] broker with access to multiple carriers, you can just enter an address and some basic info, and in under 90 seconds, you’ll get a ballpark estimate.

Still, insurance rates can vary dramatically between companies, even within the same city. Some companies may charge more because they have too much business in an area, while others may offer lower rates to attract new clients. Shopping around is important.

So, when comparing quotes, homeowners likely are tempted to go with the lowest price. Is that a mistake?

HODGES: Cheapest isn’t always best. Think of it like buying a car—you pick the type you want first, then look for the best value. You don’t just pick the cheapest car and hope for the best. Same with insurance: Make sure the coverage is adequate while getting a fair price. If you just go with the absolute lowest cost, you’re going to get that in return when you need a claims payout.

This is a decision that each family has to make in trying to balance financial responsibility with finding adequate coverage. The one thing I would encourage as you’re shopping around, keep the coverages remotely close when you compare… so you get an apples-to-apples comparison.

What are some practical ways to save on insurance?

HODGES: There are three main ways:

1. Shop around. Explore your options based on your location. Just like a consumer would shop for the best mortgage rate, they can also shop for the best insurance rate and gather multiple quotes.
2. Increase your deductible. For example, going from $500 to $2,500 could drop your premium 16-17%, which is significant. Just make sure you can cover that deductible, in case you ever need it.
3. Bundle your policies. Combining auto and homeowner’s insurance often gives a 10-15% discount. People sometimes overlook this because they focus on each policy separately.

Should homeowners insure based on purchase price, replacement cost or resale value?

HODGES: Replacement cost is key. You want to know that if your home or possessions were totally lost, you’d have enough to rebuild or replace them. Actual cash value can leave you short—like getting reimbursed for a 12-year-old roof when you need a new one. Technology has made it easier to calculate replacement costs accurately. Remember, you’re insuring the house, not the land it sits on.

How often should homeowners review or update their policy?

HODGES: Ideally, this shouldn’t fall entirely on the homeowner. A good broker or carrier should check in at renewal to make sure coverage is up-to-date, especially with lifestyle changes or home improvements. They should be your advocate throughout the insurance journey, not just at point of sale.

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