Why Your Homeowners Insurance Premium May Have Spiked—and What You Can Do About It
/Information Provide By: Association Management Group (AMG)
If you’ve recently opened your homeowners insurance renewal, you may have noticed a major jump in your premium. You’re not alone. Across the country, homeowners are seeing rate increases averaging 20 to 30 percent—and in some cases, even more.
While these increases can be frustrating, there are reasons behind them—and several practical steps you can take to manage the situation.
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Why Are Rates Rising So Sharply?
Several industry-wide factors are contributing to higher homeowners insurance premiums:
Inflation in Construction Costs
The price of building materials and labor has risen dramatically, which increases the cost to rebuild or repair your home after a loss. Insurers factor this into your premium.
More Severe Weather Events
From hurricanes to hailstorms and wildfires, natural disasters have become more frequent and damaging. Even if your home hasn’t been affected, insurers are adjusting premiums across the board to account for higher risk.
Higher Reinsurance Costs
Insurance companies also purchase insurance—called reinsurance—to protect themselves against large-scale losses. The rising cost of reinsurance is now being passed along to homeowners.
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What You Can Do as a Homeowner
Although these trends affect most policies, you may have options. Here are some practical steps you can take:
Speak with Your Insurance Agent
If your premium has increased significantly, reach out to your agent or broker and ask for an explanation. You can request a breakdown of the factors that contributed to the change. They may also be able to shop your policy with other carriers to find a better fit.
Check for Errors or Outdated Information
Sometimes insurers use outdated photos or incorrect assumptions when assessing your home’s condition. You may want to ask for documentation—like inspection notes or satellite images—so you can verify their accuracy.
Ask About Discounts or Credits
Some insurance companies offer discounts for home safety improvements, such as a new roof, security system, or updated wiring. Your insurance professional can tell you whether such upgrades might lower your premium.
Review Your Insurance-Based Credit Score
Some insurers use a credit-based score to help determine risk. If yours hasn’t, ask your agent whether your good credit history could help reduce your rate with a different carrier.
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If Your Policy Was Not Renewed
In some cases, homeowners receive notice that their policy will not be renewed—often with little explanation. If that happens:
Act Quickly
Reach out to your insurance company or broker as soon as possible. If repairs are needed, ask if they’ll grant a short extension while you address the issue.
Request Supporting Materials
Ask for any reports, inspection results, or images used in their decision. If the information is incorrect, consider hiring a licensed professional (like a roofer or home inspector) to provide updated documentation.
Explore Other Insurance Options
If your current insurer will not continue coverage, don’t wait. You should begin exploring other carriers right away. A local insurance professional can help identify companies that specialize in your area or property type.
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How AMG Supports Homeowners
At Association Management Group, we don’t sell or advise on insurance policies. But we understand how these rising costs can impact your household and your community. While we cannot interpret policies or make insurance decisions, we’re here to:
• Help coordinate with vendors when repairs are needed
• Share general information provided by your HOA
• Encourage proactive communication between you and your insurance professionals
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Important Note About Association and Individual Insurance
Because insurance requirements and policies vary by community, it’s important to understand what your homeowners association’s insurance does—and does not—cover. In almost all cases, the association’s policy does not provide complete protection for individual unit, lot, or homeowners.
AMG strongly encourages every owner to consult their licensed insurance professional to ensure they have the appropriate coverage for their unique circumstances. If your agent has any questions about what the association’s master policy includes, they are welcome to contact the association’s insurance provider directly. Your community manager can provide that contact information if needed.
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Final Note
Homeowners insurance is a critical part of protecting your investment. Staying informed and acting quickly can make a big difference.
Tip: If you have questions about your coverage or rates, your first step should be to speak directly with your licensed insurance agent or broker. They are best equipped to review your policy and explore other options if needed.
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Disclaimer: Association Management Group does not provide insurance, legal, financial, or tax advice. For assistance in these areas, homeowners should consult licensed professionals.
