Guides
Home insurance market outlook
Where home insurance pricing stands in October 2026: insurers back in profit, reinsurance costs falling, rate increases slowing, and the risks that remain.
Home insurance is in a better financial position than it was two years ago, and homeowners are starting to see it in slower rate increases, but the improvement is uneven and the next large catastrophe could undo it. Insurers made an underwriting profit in 2025 for the first time since 2019, reinsurance prices fell sharply in 2026, and average approved rate increases dropped to 4.3% in the first half of 2026 from a peak of 13.5% in 2024. None of that lowers the price of an existing policy by itself. Premiums reflect past costs, and availability in places like coastal Florida and fire-prone California depends on state rules as much as on insurer profits.
Where results stand
The results turned over quickly.
| Measure | 2023 | 2024 | 2025 |
|---|---|---|---|
| Homeowners combined ratio (Triple-I/Milliman) | 110.9 | 99.7 | 88.1 |
| NAIC direct loss ratio (losses over earned premium) | 70.52% | 61.51% | 55.14% |
| Average approved rate increase (AM Best) | 13.5% | 7.6% (8.3% in an earlier AM Best report) |
A combined ratio below 100 means the insurer kept more in premium than it paid out in claims and expenses. AM Best reports a $15.2 billion net underwriting loss for the homeowners line in 2023 and a $16.5 billion gain in 2025. Its report of September 2026 also shows a first-half 2026 direct incurred loss ratio of 48.4%, the lowest midyear mark in five years, and AM Best revised its segment outlook to stable in December 2025. Triple-I and Milliman, in July 2026, declined to publish a numeric forecast for 2026 and said results "face greater uncertainty due to elevated catastrophe risks."
The NAIC's 2025 market share data frame the size of the market: $188.95 billion in homeowners direct premiums written across the states and territories, with State Farm writing 18.67%, Allstate 9.40% and USAA 7.01%. Premium growth has been the main reason results improved. Insurers raised rates sharply in 2023 and 2024, and that higher premium kept earning through 2025 while loss costs eased.
The loss picture: 2025 was lighter on hurricanes, heavy on fires and storms
Aon puts 2025 U.S. insured catastrophe losses at $103 billion, with the January Los Angeles wildfires at about $41 billion of that (What the January 2025 Los Angeles wildfires taught homeowners). Severe convective storms, meaning hail, tornadoes and straight-line wind, were the costliest peril at $52.3 billion according to Aon's tally, a reminder that the Midwest and Plains drive more insured loss in a typical year than hurricanes (The Midwest's rising storm losses and rates, severe convective storms and rising premiums). The 2024 hurricanes are covered in What Hurricanes Helene and Milton taught homeowners.
Hurricane season runs through November 30, and a single large storm can swing a year. The outlook below assumes no such event.
Reinsurance is getting cheaper
Reinsurance, the insurance that insurers buy, drove much of the 2023 and 2024 price rises (reinsurance costs and your premium). That has reversed. Guy Carpenter's U.S. property catastrophe rate-on-line index fell 12% at January 1, 2026 and was down 16% year to date at midyear, the biggest annual decline since 2014, according to Artemis's summary of Guy Carpenter data, and is down 22% from its 2024 peak.
In Florida, June 1, 2026 renewals brought risk-adjusted price cuts of 15% to 20% in Guy Carpenter's report and an average 22.8% for Gallagher Re's portfolio, after roughly 10% cuts in 2025. Guy Carpenter reports Florida domestic insurers posted a 77% combined ratio in 2025, and that new catastrophe bond issuance for Florida sponsors topped $3.2 billion in 2026 to date. Citizens Property Insurance Corporation had 254,736 policies on October 2, 2026, compared with a peak of 1,407,805 on September 30, 2023 (florida's home insurance market: what happened and what changed, Citizens Property Insurance in Florida: who qualifies and what to know).
The lag matters. Reinsurance savings reach policyholders slowly, through rate filings that must be justified and approved. In Texas, Insurance Journal reported on October 9, 2026 that insurers had filed an average 4.3% rate decrease on homeowners policies since the start of July, including 6% for ASI Lloyds and 5.2% for Texas Farm Bureau Mutual. That is a notable signal, but it is a filed average, not a promise about your renewal.
What it means for your renewal
- Expect smaller increases, not cuts. Many renewals are still up, but the average approved increase is far smaller than in 2023 and 2024. Some insurers in softening markets have begun to file decreases.
- Shop more, not less. Insurers returning to growth compete on price for the homes they like: newer roofs, mitigation features, claims-free history. See shopping your policy at renewal: how often and how and use the home insurance renewal increase checker.
- Do not trade away coverage to save money. The cheapest way to cut a premium after a hard market is often a higher deductible or a lower limit. Read cutting coverage to save money: the cuts that backfire first.
- Deductibles stay high. Percentage hurricane and wind/hail deductibles introduced during the hard market have mostly not gone back down.
What could change the outlook
- A major hurricane or wildfire season. Reinsurers repriced after 2022's Hurricane Ian and are well capitalized now, but a single event of $50 billion or more would raise costs again.
- Rebuilding costs. Labor and materials drive claims severity; tariffs and shortages add risk (tariffs and home insurance costs, inflation, rebuilding costs and underinsurance).
- Regulation. California's Sustainable Insurance Strategy is bringing insurers back under new rules, with 12 insurer groups having filed or won approval by September 18, 2026; State Farm and Allstate were not yet open for new business there (California's Sustainable Insurance Strategy).
- Data. The NAIC is collecting ZIP-level homeowners data for policy years 2018 to 2025 for a report planned for early 2027, which may sharpen the picture of where availability is really shrinking.
- Affordability. Even with slower increases, premiums are far above 2019 levels. The GAO found that from 2019 to 2024 the average premium rose about 3% after inflation nationally but 25% or more in some southern coastal areas (the home insurance affordability crisis: what the data show).
Key takeaways
- Homeowners underwriting turned profitable in 2025: Triple-I/Milliman's combined ratio was 88.1, and AM Best counted a $16.5 billion gain.
- Average approved rate increases fell from 13.5% in 2024 to 4.3% in the first half of 2026, per AM Best.
- Reinsurance prices fell steeply in 2026, and Florida domestic insurers have been strong; savings reach policyholders slowly.
- The next catastrophe season is the main uncertainty, and the NAIC's 2025 loss ratio of 55.14% will not repeat in a bad year.
- Shop at renewal and keep your coverage; a calmer market rewards owners who compare.