Home insurance as a share of what you pay for housing

For the average borrower with an escrowed mortgage, homeowners insurance is roughly one-tenth of the monthly payment. ICE Mortgage Technology's September 2026 Mortgage Monitor reported that property insurance accounts for 9.6% of the average monthly mortgage payment and that the average single-family mortgage holder pays a record $209 a month for it. The average hides a wide spread: the same report put insurance at 24.3% of the payment in New Orleans, Louisiana (Louisiana), and 4.3% in San Jose. Your own share depends on your state, your house, your loan and what you count as housing costs.

Three ways to measure the share

Different studies divide insurance by different totals, so their numbers do not match.

Each answers a different question. The first tells you how much of your monthly check goes to the insurer. The second tells you how hard the premium is on a family budget. The third tells you whether insurance is getting dearer relative to what the house is worth. Urban counts all insurance types in its data, including flood, wind and earthquake coverage, so its premiums can run higher than a plain homeowners policy.

Insurance has grown faster than the rest of the payment

Insurance is no longer a footnote. Harvard's Joint Center for Housing Studies, citing the ICE Mortgage Monitor for March 2026, reports that average monthly insurance premiums rose 72% between 2019 and 2025, to $201, while property taxes rose 31% (JCHS, State of the Nation's Housing 2026). By September 2026 ICE had the monthly figure at $209, nearly 80% above the start of 2020, with annual growth of 8.7%, down from 15.1% at the end of 2024.

Two things sit inside those increases. One is the price of coverage, which ICE says rose about 3% per $1,000 of coverage in the latest year. The other is the amount of coverage: ICE reported that coverage limits rose 5.5% and accounted for roughly two-thirds of the increase. A bigger dwelling limit is a bigger bill by design, and how much does homeowners insurance cost? shows how to separate the two.

The share of a new borrower's payment tells a different story. Urban found that insurance as a share of principal and interest fell for loans originated from 2018 to 2024 even as premiums rose, because mortgage rates rose and pushed principal and interest up faster. So a buyer in 2024 may find insurance smaller next to the mortgage, and larger next to income, than a buyer in 2018 did. Homeowners with older, lower-rate loans see the opposite: their principal and interest is flat while insurance climbs.

A worked example

Here is a hypothetical to make the arithmetic concrete. Say a $400,000 house with 20% down, a $320,000 loan at 6.5% for 30 years (principal and interest of about $2,023 a month) and property tax of 1.15% of price (about $383 a month). Compare three premiums, one at ICE's national average of $209 a month and two invented for contrast.

The premium moves the share by almost nine points across the range, and the total payment by $250 a month. Notice that these shares differ from ICE's 9.6%: ICE averages many loans at different rates and prices, while this table fixes one house and one rate.

The share changes when the mortgage ends. Without the $2,023, the same house has only taxes and insurance left. At $209 a month, insurance is about 35% of tax plus insurance. At $375 it is nearly equal to the $383 tax bill. That is the position of the roughly 40% of homeowners who, according to JCHS, have no mortgage payment because they own free and clear. For them insurance is one of the largest recurring bills left, and the Federal Reserve's survey of 2024 found that 13% of owners who own free and clear went without homeowners insurance, against 3% of those with a mortgage (Federal Reserve, May 2025). See going without homeowners insurance: the real risk and do you need home insurance after the mortgage is paid off?.

Why the standard affordability models understate it

Affordability studies often assume a fixed insurance rate. JCHS's estimate of total monthly costs on the median-priced home, $3,120 at the end of 2025, assumes property insurance equal to 0.35% of the price a year and describes its estimates as conservative. On a $400,000 house that is about $117 a month, well below ICE's $209 average. The National Association of Realtors' insurance-adjusted Housing Affordability Index assumes insurance is about 6% of the monthly payment (NAR, April 2026). Both are reasonable national simplifications, but in a coastal or hail-prone market the actual figure can run well above the assumption. how rising insurance costs affect home prices and sales covers how that shows up at purchase.

What counts as housing costs

A fair reckoning of what you pay for housing is wider than the mortgage statement.

• Principal and interest, the part of the payment that builds equity and ends when the loan is paid off.
• Property taxes and homeowners insurance, which continue for as long as you own the house and are usually collected through escrow.
• Separate insurance, which often does not sit in escrow or in the headline figure: flood, windstorm, earthquake and umbrella policies.
• Deductibles as a hidden cost. A 2% hurricane deductible on a $400,000 dwelling is $8,000 you must hold in cash before the policy pays wind damage.
• Association dues, maintenance and utilities, which JCHS and others count toward the cost-burden measures.

JCHS counts a household as cost burdened when housing takes more than 30% of income. It reported that 20.7 million homeowners were cost burdened in 2024, with the rise driven largely by non-mortgage costs such as property taxes, energy and insurance. The wider crisis is in the home insurance affordability crisis: what the data show.

Find your own share

1. Get the annual figures. Your escrow statement lists the insurance and tax disbursements for the year. If you pay the insurer directly, use the premium on the declarations page.
2. Add what escrow does not cover. Flood, wind and any other separate premiums belong in the total.
3. Divide by what you want to know. Divide insurance by your monthly payment to compare with ICE, or by gross monthly income to compare with Urban's 3% and 5% marks.
4. Check next year's escrow forecast. A premium increase flows into the payment at the next escrow analysis, often with a shortage to catch up. The escrow shortage calculator and escrow shortages after a premium increase explain the math.
5. If the share is high, work the levers you control. Compare quotes at renewal, check the dwelling limit against rebuilding cost, and claim mitigation discounts (shopping your policy at renewal: how often and how). Be cautious with deductible increases, because they lower the premium by raising the cash you need after a loss.

Key takeaways

• ICE's September 2026 Mortgage Monitor puts insurance at 9.6% of the average monthly mortgage payment, $209 a month, but the share runs from 4.3% in San Jose to 24.3% in New Orleans.
• Insurance has grown faster than taxes: 72% versus 31% from 2019 to 2025 in the JCHS summary of ICE data, partly because coverage amounts rose.
• Shares differ by yardstick: of the payment, of income (Urban: 2.27% for 2024 loans) or of home value ($4.43 per $1,000).
• Without a mortgage, insurance and taxes are what is left, and insurance can be nearly as large as the tax bill in high-cost areas.
• Compute your own share from your escrow statement and add separate flood, wind and earthquake premiums before comparing yourself with any national figure.