US Home Insurance Costs Set to Rise a Fifth Straight Year in 2026

US homeowners face another year of rising insurance costs in 2026, extending a stretch of steep increases that has far outpaced inflation. The average annual premium is projected to rise about 4% to roughly $3,057, according to analysis from the insurance comparison site Insurify, following a 12% jump in 2025. Since 2021, premiums have climbed roughly 46%, about three times the pace of general inflation. The increases are uneven: California is expected to see one of the fastest rises, around 16%, and several states face double-digit increases, while a handful may see costs level off. Insurers attribute the pressure to a rising frequency and severity of extreme weather, particularly severe convective storms that spawn tornadoes, hail and damaging winds, along with high rebuilding and reinsurance costs. Insured losses from such storms have topped $42 billion for three consecutive years, well above the long-term average. The strain is reshaping consumer behavior: surveys suggest a meaningful share of homeowners would drop coverage if they could, even though lenders generally require insurance on mortgaged properties, raising concerns about affordability and underinsurance in high-risk regions.