Homeowners Insurance Market Enters a More Stable, Sustainable Phase
The homeowners insurance market may be entering a more stable phase after several years of significant rate increases, according to new research from S&P Global Market Intelligence (S&P GMI).
Nationally, the effective approved homeowners insurance rate change (this refers to the final, state‑approved premium level that insurers can charge for homeowners policies after their rate change requests have been reviewed and approved by a state insurance regulator) fell from approximately 13.6% in 2024 to 6.3% in 2025 and 1.8% through July 2026.
For homeowners, that slowdown could signal an important shift in how insurance companies approach pricing. Rather than relying primarily on broad-based rate increases, insurers are increasingly using property-specific factors, localized catastrophe exposure, and more selective underwriting to manage risk.
The result is a market that may be more stable overall but also increasingly individualized from one property and state to the next.
Homeowners Insurance Rates Are Stabilizing
The decline in approved rate changes suggests that many insurers have made significant progress toward achieving what S&P GMI describes as “rate adequacy.” In other words, insurers have spent recent years adjusting premiums to better reflect the cost of the risks they are assuming. As those earlier rate changes begin to earn through, carriers may have less need for sweeping increases.
S&P GMI notes that the downward trend suggests carriers have largely completed the national adequacy reset and are now pursuing price changes based on factors such as:
- State and local market conditions
- Catastrophe and weather exposure
- Peril mix (the specific combination of risks or events bundled together in a single insurance policy to protect against property damage or liability)
- Regulatory timing
- Underwriting performance
- Individual property characteristics
That doesn’t mean homeowners insurance is becoming less expensive across the board. Instead, it signals a transition toward more targeted homeowners insurance pricing.
Why Homeowners Insurance Rates Still Vary
The national numbers don’t tell the entire story. Some high-loss markets continue to experience significant rate pressure, while other states are seeing much smaller increases. S&P GMI cited Minnesota and Colorado as examples: homeowners rate increases of approximately 17.8% and 16.6%, respectively, in 2025 fell to roughly 1.6% and 0.8% so far in 2026.
Meanwhile, other markets, including North Carolina, continue to experience rate increases. This geographic variation illustrates why homeowners shouldn’t assume that a national trend necessarily reflects what is happening with their own policy.
Homeowners insurance is increasingly a local and property-specific conversation.
Insurers Are Using More Than Rate Increases to Manage Risk
Another significant development is the growing use of underwriting and coverage strategies beyond simply increasing premiums.
S&P GMI points to several “non-rate actions,” including:
Higher Deductibles
Insurers may adjust deductibles to help manage exposure to certain types of losses. A higher deductible can affect the relationship between a homeowner’s premium and out-of-pocket costs following a covered claim.
Property-Based Pricing
Property age, condition, and other characteristics can increasingly influence how an insurer evaluates risk and determines pricing.
More Selective Underwriting
Carriers are also becoming more selective about the properties and risks they choose to insure.
Together, these strategies allow insurers to better differentiate between properties rather than treating an entire geographic market as one risk category.
For homeowners, that makes it increasingly important to understand not just how much homeowners insurance costs, but why a particular carrier is offering a particular price and coverage structure.
The Homeowners Insurance Market Is Becoming More Fragmented
S&P GMI characterizes the current environment as being in a “fragmented phase,” which is being driven by differences in catastrophe experience, regulatory approvals, underwriting appetite, and earned premium performance.
Some states and peril classes may have already absorbed enough rate increases to reach greater adequacy. Others continue to face pressure because underlying losses have not normalized.
This creates a market in which two homeowners with seemingly similar properties can receive very different insurance options depending on where they live, the characteristics of their homes, and which carriers are actively seeking their type of risk.
What the Changing Market Means for Homeowners
The current homeowners insurance environment presents an opportunity for consumers to take a more proactive approach to their coverage. Instead of viewing insurance as a policy that simply renews each year, homeowners can use the changing market as an opportunity to review their options and make sure their coverage still fits their needs.
Consider reviewing:
- Your current premium and deductible
- Dwelling coverage limits
- Personal property coverage
- Liability coverage
- Additional living expense coverage
- Coverage exclusions and limitations
- Recent improvements or renovations
- Property-specific risks and mitigation measures
Most importantly, homeowners should remember that the lowest premium isn’t necessarily the best insurance value. Coverage, exclusions, deductibles, financial strength, and the insurer’s willingness to appropriately underwrite the property all matter.
How DRO’s Network of Insurers Can Help
As the homeowners insurance market becomes more specialized and property-specific, access to multiple insurance carriers can be more valuable than ever. With carrier appetites, pricing, and underwriting approaches varying significantly by location and property, your current insurer’s renewal price may not represent your only option.
DRO’s network of insurers gives homeowners access to a broader range of insurance solutions, helping them compare coverage and find an option that aligns with their property’s needs, risk profile, and budget. Whether rates in your area are stabilizing, increasing, or being influenced by local catastrophe exposure, having options matters. The insurance market is changing, and your homeowners insurance strategy should change with it.
Connect with DRO today to explore homeowners insurance options through its network of insurers.
Dayton Ritz + Osborne Insurance proudly serves the Hamptons area. Call today at 631-324-0420 or contact us online.