The Rising Cost Of Homeowner’s Insurance

With hurricanes Helen and Milton causing an estimated $50 billion dollars each in damages, it’s no surprise that homeowner’s insurance rates are skyrocketing across the country.  According to U.S. News, insurance rates have jumped nearly 22% since 2020 thanks to natural disasters like hurricanes, tornadoes, and wildfires destroying thousands of homes each year. Add to this, inflation has driven up the cost of labor and the supplies required for repairing the damages.

Homeowner’s Insurance Can Take A Big Bite Out Of Your Retirement Income

According to Insurify, retirees spend an average of 8% of their income on their home insurance premiums. Costs are even higher in popular retirement states like Florida which is experiencing increasingly destructive hurricane seasons. In fact, home insurance premiums in high-risk cities like Miami and West Palm Beach can range from as much as $13,000 to $17,000 per year for a $300,000 home. As a result, some Florida insurers are not accepting new applications for home insurance while others are pulling out of the state entirely.

The Top Factors That Drive Up The Cost Of Homeowner’s Insurance

In 2023, weather and climate-related disasters nationwide cost the United States $93 billion. California is the state with the most wildfire damage with the 2018 Camp Fire alone causing an estimated $16-billion in damages. The U.S. is also experiencing an increase in the number of high-risk areas for flooding and storm damage. Of course, insurers have passed the rising cost of damage to homeowners through higher premiums. Other factors specific to your home that drive up the cost of your premiums include the age of your home and roof and liability risks like a swimming pool or a trampoline.

“Many insurers offer discounts for these types of upgrades and, when you’re ready to sell your home, buyers appreciate the value they add.”

What You Can Do To Lower Your Homeowner’s Insurance Premiums

You can take measures to protect your home that may qualify for a discount from your insurer. If you own a home in an area prone to hurricanes, you can install impact windows and hurricane shutters to protect against flying debris. Also, consider installing a roof and garage doors that resist high wind speeds. In areas prone to wildfires, consider installing non-flammable siding, fire sprinkler systems, and dual-pane, tempered windows that can better withstand breakage caused by heat.

Many insurers offer discounts for these types of upgrades and, when you’re ready to sell your home, buyers appreciate the value they add. Even if your insurer doesn’t offer a discount, adding these protections can help reduce costly damage to your home when you’re caught in a natural disaster.