NEW YORK — Homeowner insurance premiums increased an average of 18 percent in 2026, with the steepest increases concentrated in Florida, California, Texas, and Louisiana — states that have experienced the highest catastrophe losses in recent years and where carriers are seeking to restore underwriting profitability after years of losses.
The rate increases reflect a fundamental shift in how insurance carriers are pricing catastrophe risk. Carriers are increasingly using sophisticated catastrophe models that incorporate climate change projections, rather than relying solely on historical loss data, to set rates. The result is that homeowners in high-risk areas are seeing their premiums rise to levels that more accurately reflect their actual risk.
Florida homeowners have been hit hardest, with average premium increases of 32 percent in 2026 following several years of significant hurricane and litigation-driven losses. Several carriers have exited the Florida market entirely, and the state-backed Citizens Property Insurance Corporation has seen enrollment surge to more than 1.4 million policies.
The premium increases are creating financial hardship for many homeowners, particularly those on fixed incomes or in lower-income communities. Several states have implemented premium assistance programs for low-income homeowners, but funding is limited and the programs reach only a fraction of those affected.
For restoration contractors, the premium increases have a complex effect on the market. Higher premiums may cause some homeowners to drop their coverage or reduce their coverage limits, creating a larger pool of uninsured or underinsured homeowners who cannot fund professional restoration work after a disaster.
