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If you’ve been feeling tight on your budget lately, you might want to take a look at your insurance bill.
The 45.8% increase in home insurance rates approved by regulators is having a serious impact on housing affordability.
A new report from leading online loan marketplace LendingTree found that home insurance premiums have risen nearly twice as fast as inflation in recent years.
The findings were compiled by analyzing data from S&P Global RateWatch for changes in home insurance rates and the U.S. Bureau of Labor Statistics for inflation data.
From 2020 to 2025, there was a 19.7 percentage point difference between the national home insurance rate increase of 45.8% and the inflation rate of 26.1%. This means home insurance rates rose about 1.8 times faster than inflation over this period, according to the report.
“This trend is putting a strain on household budgets in all areas,” LendingTree home insurance expert Rob Butt said in a report, as homeowners insurance is an essential part of homeownership, protecting property from major damage and providing accident liability coverage.
According to the report, the gap between home insurance price increases and inflation was the largest between 2023 and 2024. In 2023, home insurance rates increased by 12.5% against an inflation rate of 2.9%, and in 2024, home insurance rates increased by 10.7% against an inflation rate of 3.4%.
However, the gap narrowed slightly in 2025, with home insurance premium rates and inflation rates remaining at 5.9% and 2.7%, respectively, according to the report.
Home insurance premium increases exceeded inflation in all states.
The report ranked disparities in all 50 U.S. states and the District of Columbia.
Overall, Colorado (74.4), Iowa (69.7), Minnesota (61.9), Utah (50.8), and Nebraska (45.9) ranked in the top five states with the largest percentage point difference between 2020 and 2025 home insurance rate changes and inflation.
And in 2025, the five states with the largest percentage point differences are Colorado (15.9), Minnesota (14.6), Iowa (12.3), Illinois (11.3) and Delaware (8.5), the report said.
Bhatt attributes the widening disparity across the country to an increase in large-scale natural disasters and rising costs of building materials and labor. But the report said the easing in 2025 could signal that home insurance prices are stabilizing and inflation is calming.
Maddie McGay is a real estate reporter for NorthJersey.com and The Record, covering everything that’s worth celebrating about living in North Jersey. Find her on Instagram @maddiemcgay or X @maddiemcgayy and sign up for the North Jersey Living newsletter. Have a tip, trend, or great home she should know about? Email MMcGay@gannett.com.
