The rising costs and shrinking availability of property insurance, once concerns in just a few states, have become a nationwide problem. Homeowners across the country face double-digit insurance premium hikes, while others struggle to find coverage at all. In states like California and Florida, some major insurers have pulled out entirely. As the problem spreads, Washington can’t afford to stay on the sidelines.
Property insurance is regulated at the state level, but that doesn’t mean federal policymakers are powerless. Congress and the administration can—and should—act. They can help state and local governments reduce disaster-related risks and ease the insurance burden on federally supported affordable housing.
With Republicans controlling Congress by razor thin margins, any congressional action to address the issue must be bipartisan. Ultimately, this is not a red state or blue state problem—property insurance costs are rising in nearly every congressional district. Without bipartisan action, the costs will only grow.
Long before the Los Angeles wildfires, the devastation from Hurricanes Milton and Helene, or the recent tornadoes and severe weather across the Midwest, homeowners were already facing increasingly high property insurance costs. Between 2019 and 2024, average homeowners insurance premium rates rose by 45 percent. At the same time, housing costs reached record highs due to a limited housing supply, high mortgage rates, and rising home values—factors that are also driving up property taxes. Since 2019, average home values have climbed by more than $100,000. That may benefit homeowners looking to sell, but such a significant increase can burden those already struggling to pay property taxes and insurance premiums.
For millions of Americans, property insurance isn’t just a line item in the household budget, it’s the difference between financial security and financial ruin. When natural disasters strike, property insurance plays an essential role in protecting families from being overwhelmed by the costs of catastrophic damage. As hurricanes, wildfires, severe storms, and other events grow more frequent and damaging, property owners must be able to find and afford insurance coverage that sufficiently reflects their increased risk.
With June 1 marking the start of another Atlantic hurricane season, having the right level of insurance coverage is one of the most important ways a homeowner can prepare. But for millions of households already stretched thin by mortgage payments, homeowners insurance costs are a growing burden. Premiums are difficult to budget for because they can change yearly. In 2019, the average annual increase was only 2.5 percent; but for the last two years, it’s been more than 10 percent each year. More families now face an impossible choice: keep their homes insured or keep up with mortgage payments.
Renters aren’t spared these added costs. Higher property insurance premiums are also impacting multifamily housing developers, worsening the rental housing shortage and driving up rents. As property insurance costs climb, planned apartment construction projects can become financially unfeasible—further limiting the already short supply of rental homes at a time when half of renters spend more than 30 percent of their income on housing.
For affordable housing operators, the situation is even more dire. Unable to raise rents, they must cut other operating expenses, delay building improvements, or reduce their insurance coverage—putting both residents and buildings at risk.
So what can Washington do?
First, Congress can support efforts to reduce disaster-related risks. Lawmakers should strengthen existing incentives for states and cities to adopt resilience measures—fortifying homes against wind, hail, flooding, and wildfires—to lower costs for both property owners and insurance companies when disasters strike. Some states already offer insurance premium discounts for homeowners who upgrade their homes to meet resilient building standards. Many also provide grants to help homeowners cover the upfront costs of those upgrades. Scaling up these efforts could bring insurance costs down.
Second, the federal government should expand access to disaster risk data. Timely, accurate information can help property owners make more informed decisions on where to move, how to build, and what coverage to check. Better data transparency will require coordination among the federal government, state insurance commissioners, private insurance companies, and other stakeholders. Together, they can improve data collection, promote informed choices, and help stabilize the property insurance market.
Finally, the federal government must strengthen support for affordable housing providers, who are uniquely unable to pass higher costs on to residents. The Department of Housing and Urban Development has already taken steps—raising allowable deductibles, adjusting rent calculations to reflect rising property insurance costs, and clarifying that Community Development Block Grant funds can cover insurance premiums. Making these changes permanent and building on them would offer a vital lifeline to affordable housing operators facing rising insurance prices and flat revenues.
Rising property insurance costs are no longer a regional problem—they’re a national concern. Congress and the Trump administration have several tools to begin addressing the twin challenges of affordability and availability. Any actions should be considered thoroughly, alongside a broad coalition of state insurance regulators, industry, and other stakeholders ready to work with federal policymakers. The one thing Washington can’t afford to do is ignore the problem.
Dennis Shea is an executive vice president at the Bipartisan Policy Center and leads its J. Ronald Terwilliger Center for Housing Policy.
Emma Waters is a senior policy analyst at the Bipartisan Policy Center.
The views expressed in this article are the writers’ own.
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