REGIONAL – Recent testimony from a New York State Senate hearing revealed the rapidly shifting nature of the home insurance market in New York and nationwide.

Premiums are increasing, policy cancellations are hurting families, and many New Yorkers are opting to forgo home insurance altogether. Lawmakers, advocates, and industry leaders are now arguing the issue is becoming too severe to ignore.

Although New York is currently outside the top 20 most expensive states for home insurance, costs are rising due to inflation, flawed risk modeling, intensifying natural disasters, and more. According to the American Property Casualty Insurance Association (APCIA), the 2025 average homeowners insurance premium in New York is about $1,900 — $570 below the national average. For comparison, Florida is one of the highest at roughly $5,800 and Vermont residents pay the lowest on average at $825.

In August 2025, Senate Committees on Investigations and Government Operations; Insurance; and Housing, Construction, and Community Development launched an investigation to request documents and information from the Department of Financial Services (DFS), insurance associations, and carriers. The Nov. 18, 2025, hearing was held to continue this work by examining the factors contributing to the rising costs and limited availability of residential insurance. The state said it hopes to “ensure that property/casualty insurance markets are affordable, accessible, and stable in the years to come.”

The November 2025 hearing

Over 30 public servants and experts testified at the hearing, warning legislators that these trends are hurting consumers and creating unsustainable markets.

“[Americans] are facing skyrocketing premiums, shrinking coverage, and cancellations with little or no warning,” said Sara Enright, on behalf of Consumer Reports. “In New York, homeowners have dealt with average increases of over $1,000 in their premiums since 2020, much higher than the average increase across the U.S.”

While New York is near the middle of pack for current premium rates, the costs are increasing more rapidly than other states. Additionally, Enright said that nearly 500,000 New York homeowners are completely uninsured.

Enright shared an example from one of the constituents Consumer Reports spoke to, an Upstate New Yorker who said that he hasn’t filed any claims in the past 10 years yet his premiums have risen 300%. The man’s story reflects a pattern across New York (and nationwide), Enright added, saying that homeowners everywhere are experiencing “steep, unexplained rate increases; opaque underwriting decisions; inadequate notice; and fear of losing affordable coverage.”

“This is not just a problem for homeowners, it’s a problem for every household: renters are seeing higher housing costs as property owners pass along rising insurance expenses, and aspiring homeowners are being priced out of the mortgage market as insurers retreat from areas they deem ‘too risky’,” Enright said.

Senator James Skoufis (D-42), citing a trade association report, said, “Despite heavy catastrophic losses in 2025, including the costliest wildfires on record, the U.S. property and casualty industry recorded its best mid-year underwriting gains in nearly 20 years.”

“Property owners, regardless of a spotless claims history or any fault of their own, are seeing premiums dramatically escalate in recent years,” said Sen. Skoufis. “Many are boxed out of the voluntary insurance market, again, through no fault of their own, and forced to pay even more with insurers of last resort.”

Speaking after Sen. Skoufis, acting DFS Superintendent Kaitlin Asrow referenced a Consumer Federation of America report that found, from 2021 to 2024, annual personal residential property insurance premiums in America increased by 24% or $648. She went on to explain that claims costs nationwide have risen 45% from 2012 to 2022, with claim severity increasing by 107% or $9,469 per claim.

Causes of rising costs

Asrow cited “the increasing frequency and severity of catastrophes due to climate change, the rising costs of materials and repairs driven by inflation, a tightening reinsurance market, and the effects of social inflation” as factors causing the uncertainty and risks that insurance markets are facing.

More frequent and severe weather events have been cited as the leading factor stressing homeowners’ insurance, Asrow said. The U.S. National Oceanic and Atmospheric Administration has reported an increasing number of natural disasters per year, exacerbated by climate change, which have exceeded $1 billion in damages.

Residential property insurance costs have also been impacted by increasing “replacement costs,” or what it takes to repair or rebuild homes. Asrow pointed to inflation, worker shortages, rising wages, and supply chain disruptions causing this issue.

“According to the Federal Insurance Office, between 2020 and 2023, replacement costs for property and casualty-related losses increased by an average of 4%,” she said. “These increasing costs are ultimately reflected in premiums.”

Asrow went on to add that more frequent and costly litigation, as well as larger jury awards, have led to costs being passed on to property owners. The cost of property catastrophe reinsurance — or “insurance for insurance companies” — nearly doubling in less than eight years has also played a big role, according to Asrow.

Moving forward

Pointing to DFS-drafted legislation included in the FY25 enacted budget, Asrow said that insurers are now prohibited from “inquiring about or considering, canceling, refusing to issue or renew, increasing the premium of, or excluding, limiting, restricting or reducing coverage…” based on a resident’s income and/or if they live in affordable housing development, receive rental assistance, or live in a dwelling that’s owned by a cooperative or public housing authority.

Asrow also said that DFS issued guidance in 2024 reminding insurers of their obligation to provide discounts to homeowners who install hurricane-resistant glass and storm shutters. DFS also encouraged insurers to offer additional discounts for other types of loss mitigation devices such as roof fortifications, deadbolt locks, smart water monitors and shutoff devices, smoke detectors, and sprinkler systems. According to Asrow, incentivizing retrofits is proven to reduce losses for insurers and policyholders.

Enright suggested “…stronger state-level regulations for transparency, fairness, and accountability in how insurers set rates, renew policies, and process claims, while supporting community resilience in the face of escalating pressures from extreme weather events.”

Many who testified at the hearing agreed that the problem isn’t untenable at the moment; however, it is escalating.

“It is incumbent upon us to act now, before we reach a crisis point,” Asrow said.

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