The cost of home insurance in the United States rose by ~89% between 2014 and 2025Rapidly rising house prices, more frequent extreme weather events and inflation had an impact on insurers and homeowners. ICE analysts share key insights from their recent decade-long investigation into the forces driving rising insurance costs across the country.
Over the past decade, home insurance costs have risen rapidly in many parts of the United States. This has been driven by numerous factors, including an increase in costs associated with extreme weather events, the COVID-era spike in national home values and high inflation in 2021-2022.
Before 2017, five-year rolling average costs associated with billion-dollar disasters were consistently lower than 2017 $100 billion in the US However, since 2017, these costs have been continuously exceeded $120 billion.
Rising costs due to extreme weather events are likely to continue as these events are projected this will become increasingly common and severe, creating increasing cost pressures for federal, state and local governments, as well as insurance companies and homeowners.
In some parts of the country, rising insurance costs are already contributing to housing affordability challenges. For homeowners with mortgages, insurance is an unavoidable expense because lenders require basic home insurance, while homeowners in high flood risk areas face even higher costs because lenders require them to purchase additional flood insurance.
Premiums are also tied to the amount of coverage (often determined by the value of the home), and over the past five years, home values, as well as construction and replacement costs, have increased across the country. Between March 2020 and January 2023, ICE’s national single-family home price index increased by almost 36%.
As home values increase, the amount of insurance coverage purchased also typically increases, leading to an increase in premiums, even if all other factors remain constant. High inflation in recent years has also contributed to an increase in the dollar amount of insurance premiums paid across the country.
Rising insurance costs are likely to have broad impacts on the U.S. housing and mortgage markets. Home values could be affected because fewer potential homebuyers can afford the insurance they need to get a mortgage, and the decline in home values could be disruptive to local governments that rely heavily on property taxes.
Because these impacts are interrelated, increases in insurance costs will impact every participant and stakeholder in the U.S. real estate market. This means it’s critical to understand trends in insurance costs across the country.
To determine the contribution of these various factors, ICE examined the underwriting costs of more than 18 million single-family home loans in the ICE McDash dataset, which contains anonymized data on U.S. home loans through 2013.
The analysis shows that insurance costs have increased across the board over that period, but that these cost increases vary across different loan cohorts.
Insurance costs for all active loans: Looking at the broadest view of the increase in insurance costs – the 12 million single-family loans active in 2014 and 18 million active loans in 2025 – ICE data shows that the average total insurance cost for these loans increased from $1,270 in 2014 to $2,405 in 2025 (+89%). Cost changes vary significantly depending on location.
Figure 1. Average total insurance costs for all active single-family loans in the ICE McDash data by county in 2014 and 2025. Source: ICE McDash as of 9/01/2025.
Insurance costs for ongoing existing loans:
Perpetual loans are tied to established homeowners. Unless an insurance company drops this, these households are unlikely to shop for a cheaper or better policy every year. For the two million loans in the ICE McDash dataset that existed continuously between December 2014 and August 2025, the average total underwriting cost nearly doubled from $1,230 in 2014 to $2,440 in 2025 (+98%).
Loan insurance costs arise in each year:
Home buyers involved in newly originated loans were likely involved in the selection of insurance policies that year. In the ICE McDash dataset, 950,000 loans were originated in 2014, with one million in 2024. The average total underwriting cost for loans in 2014 was approximately $1,150, but by 2024 this had risen to $1,950 – significantly lower than the increase in costs for continuously existing loans, which was +69% higher in 2025 than in 2014.
Cost per $1,000 of coverage
Inflation and changes in the amount of coverage have contributed significantly to the increase in insurance costs between 2014 and 2025. As a ratio, the cost of insurance per $1,000 of coverage provides a perspective on these costs that takes into account both inflation and changes in the amount of coverage.
Figure 2. Average total risk insurance cost per $1,000 of coverage for all active single-family loans in ICE McDash data by county in 2014 and 2025. Source: ICE McDash as of 01/09/2025.
Comparing the cost per $1,000 of coverage for continuously existing and newly originated loans reveals an interesting insight: loans that were continuously in existence from 2014 to 2025 have a higher average cost than newly originated loans every year. This pattern suggests that many homeowners with long-term loans could, by actively participating in insurance policies and deductible selection – as first-time homebuyers often do – significantly reduce their insurance costs.
Figure 3. Average hazard insurance cost per $1,000 of coverage over time for three loan cross-sections. Source: ICE McDash as of 01-09-2025.
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