Map Shows States Where Home Insurance Has Risen Faster Than Inflation

Home insurance rates have risen faster than inflation in 44 states and the District of Columbia over the past five years, according to a new report by LendingTree trying to quantify the burden that these growing costs are putting on American households.

Between 2020 and 2025, regulator-approved home insurance rates jumped 45.8 percent nationally, compared with a cumulative 26.1 percent increase in the consumer price index (CPI). That makes for a 19.7 percentage point gap between the two, with insurance rising nearly double—roughly 1.8 times—as fast as inflation.

It is not just inflation that home insurance rate hikes have outpaced. From 2020 through 2024, rates have also risen faster than the median household income in all but nine states.

In Which States Have Home Insurance Rate Hikes Outpaced Inflation?

There are only five states in the country where home insurance rate increases have not outpaced inflation: West Virginia (-8.7 percentage points), Vermont (-2.7 percentage points), Maine (-2.3 percentage points), Alaska (-1.0 percentage points), and New York (-0.5 percentage points).

In every other state and the District of Columbia, home insurance rates have risen faster than inflation, putting a strain on “family budgets across the spectrum,” according to LendingTree’s home insurance expert and licensed insurance agent, Rob Bhatt, no matter their income level. 

But it is Colorado which leads the nation with the biggest gap between home insurance rate increases and the inflation rate between 2020 and 2025. In the state, home insurance rate growth outpaced inflation by 74.4 percentage points. 

Next came Iowa, with 69.7 percentage points, and Minnesota with 61.9 percentage points. 

When it came to the largest gap between home insurance premiums hikes and median household income growth, Iowa led the nation with a 49.5 percentage point difference, followed by Utah (43.8) and Colorado (42.8). 

On the other hand, Vermont (-11.4), South Carolina (-9.0) and Maine (-8.3) were among the states where household income growth outpaced home insurance rate increases.

The vertiginous rise in home insurance rates have been driven by a combination of factors, according to experts, including an uptick in natural disasters driven by climate change, including hurricanes, extreme wind events and wildfires, and the growing costs of materials used to rebuild damaged or destroyed homes.

“The costs of building materials and labor have also gone up at higher-than-normal paces,” Bhatt said. “Insurance companies have had to repair or rebuild more homes than normal, and the cost of rebuilding each one is more expensive than it was before 2020. Unfortunately, insurance companies raise their rates to account for this type of growth in their expenses.”

This is likely why only a handful of states have avoided such steep home insurance rate increases.

“The New England states haven’t been hit as hard by natural disasters as most other parts of the country, and this may be why home insurance rates have remained stable in Vermont and Maine,” Bhatt said.

In Colorado, there were 22 billion-dollar natural disasters between 2020 and 2024, the equivalent of 4.4 per year, causing between $10 billion and $20 billion in damages, according to the National Centers for Environmental Information.

What Does This Mean For Homeowners?

Spiralling home insurance costs are weighing heavily on homeowners already bogged down by higher property taxes, historically elevated borrowing costs, and rising homeowners association (HOA) fees. 

According to Bhatt, higher insurance costs “are having a ripple effect on household budgets. Homeowners insurance is essential, and rising costs can cut into necessities such as groceries, utilities and even mortgage payments.”

The Gap May Be Shrinking

While alarm over the state of the home insurance industry nationwide persists, LendingTree reported that the gap between home insurance rate hikes and inflation is behind us. 

In 2024, homeowners insurance rates increased 12.5 percent as inflation was 2.9 percent, a 9.6 percentage point gap which means that insurance rates rose around 4.3 times faster than the inflation rate. It was the biggest gap reported in the 2020-2025 period.

But a year later, in 2025, the gap shrunk a bit, as the rates of regulator-approved homeowners insurance policies rose a relatively low 5.9 percent. This is “one bit of good news” for homeowners, Bhatt said.

“There are signs that home insurance prices may be stabilizing. Inflation has cooled, and prior rate hikes may be giving insurance companies enough revenue to cover their growing claims costs,” he said.