Property insurance expenses for American homeowners have reached record highs in the first half of 2025, as natural disasters tied to climate change continue to wreak havoc across the country. Areas recently affected by hurricanes, floods, and wildfires — including parts of California and the Carolinas — have seen particularly steep hikes in insurance premiums.
According to the latest Mortgage Monitor report published by Intercontinental Exchange Inc. on Monday, the average annual insurance cost for a single-family home with a mortgage in the U.S. increased by 4.9% during the first six months of 2025. This rise pushed the typical yearly payment to just under $2,370, marking a new all-time high.
Several regions have felt the brunt of this trend more acutely than others. North Carolina and South Carolina, which suffered extensive flooding due to Hurricane Helene last year, experienced some of the largest premium increases nationwide. California, still grappling with the aftermath of destructive wildfires that tore through parts of the state earlier this year, also saw sharp spikes in home insurance costs.
In Los Angeles, where fires devastated entire residential areas in January, insurance premiums for homeowners surged by 9% between January and June. Compared to mid-2024, this represents a staggering 20% year-over-year increase.
The growing frequency and intensity of extreme weather events — widely attributed to the worsening effects of climate change — have forced insurance companies to adjust. Many insurers are raising premiums to reflect the rising risk, while others are exiting high-risk markets entirely, leaving homeowners with fewer coverage options.
Despite these increases, California homeowners still pay some of the lowest average premiums in the country. On the other hand, states vulnerable to hurricanes, hailstorms, and other severe weather events — particularly in the South and Midwest — continue to face the highest insurance costs in the U.S.
In Florida, lawmakers have implemented policy changes aimed at encouraging private insurers to return to the market. These efforts appear to be bearing fruit: the proportion of homeowners relying on state-supported insurance has dropped significantly. In Miami, the most expensive city in the country for property insurance, the percentage of mortgage-holding homeowners covered by the state’s insurance plan has fallen from 46% to 27% in just 18 months.
As climate-related disasters become more frequent and intense, industry analysts expect home insurance costs to keep rising — particularly in regions where environmental risks are greatest.