New national data show a homeowners insurance market that remains broadly active while becoming more expensive and less predictable for consumers in some areas. For real estate professionals, the findings add urgency to checking a property’s insurance options before financing and contingency deadlines.
The National Association of Insurance Commissioners’ first nationwide analysis of state-collected market conduct data found that 715 companies wrote homeowners coverage in 2024. Underwriting results improved across all four NAIC regions that year, and three regions recorded positive underwriting profits.
At the same time, inflation-adjusted average premiums per policy increased between 18.3% and 43.3% across the regions from 2018 through 2024. Company-initiated nonrenewal rates rose between 96% and 216%, depending on the region.
Those percentages should not be read as a direct comparison between lost coverage and premium costs because they measure different outcomes from different starting points. The full NAIC report shows that 2024 company-initiated nonrenewal rates ranged from 11.7 to 25.1 per 1,000 policies in force.
National strength masks local insurance pressure
The report describes the overall market as operationally strong, but it also found that more than half of the companies operating consistently in each NAIC region reduced their policy counts between 2018 and 2024. Regional and state-focused insurers absorbed some of those policies.
Claims also became more frequent and severe overall, with some of the largest increases occurring from 2021 through 2024. The NAIC cautioned that state and regional averages can conceal localized coverage gaps because weather exposure, rebuilding costs, insurer participation, and mitigation efforts vary within markets.
An earlier Federal Insurance Office analysis provides a closer look at that geographic divide. Using more than 246 million policy records from over 330 insurers between 2018 and 2022, the Treasury Department found that average nonrenewal rates in the highest-risk 20% of ZIP codes were about 80% above rates in the lowest-risk 20%.
Consumers in the highest-risk ZIP codes paid an average annual premium of $2,321 during that period, 82% more than consumers in the lowest-risk group. Average claim severity was approximately $24,000 in the highest-risk areas, compared with about $19,000 in the lowest-risk areas.
The figures are historical and do not establish a property’s current insurability. Treasury’s public ZIP-code data also exclude areas with fewer than 10 insurers or 50 policies, so an omitted ZIP code may reflect the reporting threshold rather than the absence of insurance stress.
Mortgage rules now allow more flexibility for roofs
Fannie Mae and Freddie Mac revised their property insurance requirements in March 2026 to permit actual cash value coverage for roofs on eligible single-family homes and project developments. Under Fannie Mae’s lender guidance, roofs must remain insured but no longer have to be covered on a replacement-cost basis. The remainder of the building generally must retain replacement-cost coverage.
Actual cash value coverage accounts for depreciation, meaning a roof claim may pay less than the amount required to install a new roof. Buyers and sellers should review the policy terms with a licensed insurance professional rather than assume the change will reduce premiums or make every property eligible.
Fannie Mae’s selling-policy changes concerning roof coverage took effect immediately in March. Separate servicing changes — including procedures for monitoring coverage and obtaining lender-placed insurance after a cancellation, nonrenewal, or lapse — must be implemented by January 1, 2027. Those servicing rules apply to existing mortgage administration, not a buyer’s pre-closing insurance approval.
What real estate agents should verify
Agents can reduce late-stage surprises by asking sellers for the current declarations page, roof coverage terms, and any cancellation or nonrenewal notices. Buyers should obtain property-specific quotes early and have their lender confirm that proposed coverage meets loan requirements before removing an insurance or financing contingency.
Where available, state insurance department data and FAIR Plan information can add local context. Agents should present those sources consistently, avoid predicting a carrier’s underwriting decision, and direct questions about coverage, claims, and policy suitability to licensed insurance professionals.