Extreme weather, amplified by climate change, has raised insurer risks and insurance rates for U.S. homeowners, especially in the last decade. Damages from large natural disasters have soared from about $22 billion per year in the 1980s to $149 billion per year in the 2020s, adjusted for inflation.[1]
Of course, climate disasters don’t occur evenly across the country. Some states face extraordinary instability, while others are more insulated from changing climate patterns.
Florida, for example, sustained a staggering $237 billion in disaster damage from 2020 through 2024 — increasing non-renewal rates and stoking the state’s insurance crisis.[2]
California has its own insurance crisis caused by elevated wildfire risk and a complex regulatory environment where insurers struggle to stay profitable. Recent devastating wildfires in Los Angeles County are the latest example, causing up to $30 billion in insured losses.[3] Meanwhile, across the country, New England’s six states combined for less than $8 billion in damages over the past five years.
“Climate change is one of the biggest factors driving volatility in the home insurance market today,” said Betsy Stella, vice president of carrier management and operations at Insurify. “Insurers must respond with revised predictions and pricing.”
Some states have managed to avoid the worst in recent years. To determine which states are the least risky for homeowners, Insurify’s data science team developed its Home Insurance Climate Stability Index, which scores states from 0 to 100 based on their susceptibility to climate-caused spikes in insurance costs.
Stability scores are based on several factors, including insurance rates, insurance rate growth, insurer loss ratios, major natural disasters, and estimated major disaster damage per capita.
Key Takeaways
Natural disasters have caused $747 billion in damages in the U.S. since the start of 2020. Over that time, the average home insurance rate climbed from $1,959 to $2,584.
Maine is the least susceptible state to climate-driven insurance spikes, earning the highest score in Insurify’s Home Insurance Climate Stability Index. Maine benefits from low insurance rates and limited exposure to weather disasters.
New England is home to four of the 10 states that scored highest in Insurify’s Home Insurance Climate Stability Index.
Vermont has the lowest average home insurance rates overall, at $954 per year, less than half the national average ($2,584) and 11 times less expensive than Florida’s average rate ($10,675).
The average annual premium in the 10 most climate-stable states is 3.5 times less expensive than it is in the 10 least stable states ($1,354 versus $4,793).
Massachusetts has the lowest average insurer loss ratio over the past five years, meaning insurance companies take in more money in premiums than they pay out in claims.
Washington, D.C., is the only jurisdiction in Insurify’s analysis that has seen no major natural disasters since 2020, while Alaska and Hawaii have only had one each. For comparison, Texas has had 68, while Florida and Louisiana have each had 34.
Top 10 states dodging climate-related home insurance spikes
More than 100 individual billion-dollar disasters have struck the U.S. since the beginning of 2020, with most disasters impacting multiple states.[1] By analyzing these events, their costs, and their effect on insurance rates, Insurify identified the 10 states with the lowest risks of skyrocketing rates, based on their performance in Insurify’s Home Insurance Climate Stability Index.
1. Maine
Home Insurance Climate Stability Score: 100/100
Average annual insurance premium: $1,266
Cost of major disasters (2020–2024): $480 million
Maine is Insurify’s top-rated state for home insurance stability. Unlike most states, home insurance became more affordable for Mainers in 2024, as the average rate declined by 4%.
Maine’s geography protects it from excessive natural disasters, including tropical cyclones, which are generally the most expensive types of disasters.[1] Those storms rely on warm water and tend to cool and lose strength by the time they’ve reached Maine.
However, disasters do strike occasionally. Four major disasters — including multiple winter storms — have affected the state in the past five years, tallying an estimated $480 million in damages. Those figures look large, but in context, the average state has seen five times as many disasters at 35 times the cost.
Maine’s relatively stable climate is evident in local insurer loss ratios. The state has the second-lowest average loss ratio, at 43.3 — about 35% less than the national average (66.2) and a quarter of Louisiana’s ratio (158.5).
2. New Hampshire
Home Insurance Climate Stability Score: 98.8/100
Average annual insurance premium: $1,226
Cost of major disasters (2020–2024): $227.5 million
New Hampshire homeowners are at lower risk of climate-driven insurance spikes compared to the typical American. Despite being a heavily forested state, the wet New England climate makes it harder for wildfires to start. The state’s forests and freshwater put it at lower risk of costly droughts.[4]
Significant disasters still happen, with two instances of flooding and one winter storm hitting the state in 2023, causing an estimated $227.5 million in losses.
Despite those disasters, the state’s average home insurance rate didn’t increase in 2024. The current price of $1,226 per year is just half the national average ($2,584). The average loss ratio is one of the lowest in the nation, at 45.6, meaning insurers are generally profitable and don’t need to raise rates to make up for losses.
3. Alaska
Home Insurance Climate Stability Score: 96.9/100
Average annual insurance premium: $1,197
Cost of major disasters (2020–2024): $52.5 million
Alaska’s low disaster damages and insurance rates make it one of the top performers in Insurify’s Home Insurance Climate Stability Index. Homeowners in Alaska pay the third-lowest premiums of any state, with an average annual rate of $1,197. Alaska’s cold weather makes it less susceptible to droughts, fires, and cyclones. The state’s sparse population means it’s less likely for one individual disaster to cause billions in damages.
One billion-dollar disaster has hit the state in the past five years — a series of 2022 Western wildfires. Those damages, however, were spread out over multiple Western states, bringing Alaska’s estimated damage cost from the incident to $52.5 million. That’s the lowest dollar amount any state, excluding Washington, D.C., has incurred due to major disasters over the past five years.
Flooding and landslides pose some risks to Alaska homeowners. Home insurance doesn’t cover flood damage, which is generally left to the Federal Emergency Management Agency. But state legislators have proposed offering state flood insurance that may include coverage for certain landslides.[5]
4. Washington, D.C.
Home Insurance Climate Stability Score: 96.1/100
Average annual insurance premium: $1,266
Cost of major disasters (2020–2024): $0
The capital’s smaller size and favorable location have protected homeowners from disasters and rising home insurance costs. D.C. is inland enough to lower its hurricane risk and urbanized enough to limit fuel for wildfires. No billion-dollar disasters have struck the area in the past five years. The average insurance rate in the district is $1,266 per year — half what the typical U.S. homeowner pays ($2,584).
Despite better conditions than in other states, D.C. isn’t wholly shielded from climate change. The district experiences snowstorms and saw record-breaking summer heat in 2024.
5. West Virginia
Home Insurance Climate Stability Score: 95.4/100
Average annual insurance premium: $1,374
Cost of major disasters (2020–2024): $385 million
West Virginia’s geography, mountainous and rugged, limits the state’s exposure to major disasters, including severe thunderstorms.
“If a thunderstorm hits mountains, those will disrupt the circulation of thunderstorms and often weaken them,” Jase Bernhardt, Ph.D., assistant professor for the Department of Geology, Environment, and Sustainability at Hofstra University, told Insurify.
West Virginia is one of six states that saw their average home insurance rates decline in 2024. The typical price fell from $1,392 to $1,374 per year, which remains about $1,200 cheaper than the national average ($2,584).
Overall, nine major disasters have affected the state in the past five years, tallying an estimated $385 million in damages. The average U.S. state, meanwhile, has faced 21 major disasters and $16.7 billion in damages.
6. Vermont
Home Insurance Climate Stability Score: 95.1/100
Average annual insurance premium: $954
Cost of major disasters (2020–2024): $1.6 billion
Vermont has the nation’s lowest home insurance rates, with an average price of $954 per year. Rates remain low, as major disasters are relatively infrequent — only four over the past five years.
Fewer disasters means lower expenses for insurers, which is why the state has the third-lowest loss ratio in the country, at 45.2. For every $100 insurers receive in premiums, they pay out $45.20 in claims. For comparison, the loss ratio in Louisiana is nearly four times higher, at 158.5, meaning insurers pay out $158.50 in claims for every $100 received in premiums.
Bernhardt said that, similar to other New England states, the colder, wetter weather makes severe storms less common in the region. Still, Vermont isn’t immune to catastrophic weather, particularly flooding. In July 2023, parts of Vermont saw up to 8 inches of rain over two days, qualifying as a 1-in-500-year storm event due to its very low likelihood.[6] The ensuing flooding damaged thousands of homes, underscoring the fact that even relatively stable states can face perilous climate consequences.
7. Delaware
Home Insurance Climate Stability Score: 94.4/100
Average annual insurance premium: $1,254
Cost of major disasters (2020–2024): $385 million
Although Delaware is a coastal state, direct hits from hurricanes are less frequent than in nearby North Carolina and New Jersey, Bernhardt said.
Delaware has dealt with eight major disasters in the past five years, four of which were severe storms. Losses from those disasters were relatively low for Delaware, with nearby states absorbing much of the damage.[7] These events have caused $385 million in damages since the beginning of 2020. Only Alaska, New Hampshire, and D.C. have incurred fewer damages in that span.
The average home insurance rate in Delaware is $1,254 per year, less than half the national average ($2,584). Rates also increased less than the national average from the end of 2023 to the end of 2024, going up 4% in Delaware and 9% in the U.S. at large.
8. Massachusetts
Home Insurance Climate Stability Score: 92.8/100
Average annual insurance premium: $1,894
Cost of major disasters (2020–2024): $2.6 billion
Massachusetts is one of four New England states that earned a top 10 score in Insurify’s Home Insurance Climate Stability Index. Cold ocean temperatures help prevent hurricane formation near the coastal state.
“The further north you get, the fewer [hurricane] landfalls you expect to see,” Bernhardt said.
Although natural disasters have racked up $2.6 billion in damages over the past five years in Massachusetts, 37 states have incurred more damages over the same period. Massachusetts has the lowest home insurance loss ratio in the country, at 39.9. That lack of losses helps keep home insurance prices more stable in the state, which saw a 2% increase in rates in 2024 compared to the national average increase of 9%.
9. Nevada
Home Insurance Climate Stability Score: 92.6/100
Average annual insurance premium: $1,370
Cost of major disasters (2020–2024): $402.5 million
Although some interior states are vulnerable to tornadoes, Bernhardt said Nevada’s mountains, dryness, and distance from the Gulf of Mexico make twisters less frequent.
The state is more prone to droughts and wildfires, which make up five of the six major disasters that have hit Nevada since the beginning of 2020. Those disasters led to $402.5 million in damages — only five states have incurred fewer damages in that time frame.
The state’s average home insurance rate is $1,370 per year. Despite lower-than-average rates, fire risks have prompted some insurers to pull back coverage in certain parts of the state, particularly in the north. In 2023, insurers declined nearly 5,000 home insurance applications from Nevada homeowners. Loss ratios for insurers, however, remain below the national average (56.0 versus 66.2).
10. Wyoming
Home Insurance Climate Stability Score: 91.8/100
Average annual insurance premium: $1,740
Cost of major disasters (2020–2024): $707.5 million
Wyoming is one of two Western states ranked in the top 10 of the Home Insurance Climate Stability Index. The average home insurance rate is $1,740 per year, well below the national average ($2,584). Additionally, unlike most states, the typical home insurance rate didn’t increase in 2024.
The state is sparsely populated, which means disasters don’t accumulate large property damage totals.
“More properties located in a specific area equals a higher risk for insurers to suffer a substantial loss from a natural disaster versus a sparse location,” said Mark Friedlander, director of corporate communications at the Insurance Information Institute.
Droughts, storms, and wildfires have posed problems for homeowners at times, but these events remain infrequent compared to other states. Eight major disasters have affected Wyoming in the past five years, though the combined damages haven’t crossed $1 billion.
States where climate-driven disasters are driving up home insurance costs
Natural disasters have inflicted nearly $750 billion in damages across the U.S. since the start of 2020, with some states suffering a disproportionate share. Over half of those damages affected three states — Florida, Louisiana, and Texas — whose proximity to the Gulf of Mexico has made them vulnerable to direct strikes from hurricanes, the most costly form of natural disaster.
Those states tend to get most of the attention for devastating disasters, but states with moderate climate risks, like Minnesota and Illinois, are also beginning to see disaster damage reflected in their home insurance rates. Both have witnessed a sharp uptick in severe storm damage, and home insurance rates in each increased by over 20% in the last year alone.[8]
Colorado is another state to watch. In the last five years, it’s incurred more than $15 billion in damages from wildfires and severe storms, causing residents to pay $4,779 per year for home insurance — nearly double the national price.
Below are the 10 states with the worst Home Insurance Climate Stability Index scores.
10 worst states for home insurance stability
Insurify’s analysis examined disasters from 2020 through 2024 and doesn’t reflect the impact of catastrophic fires in the Los Angeles area in January 2025. Financial firms have estimated tens of billions in damages, but the true cost is still being calculated.
In the meantime, California Insurance Commissioner Ricardo Lara has issued a moratorium disallowing insurers from canceling or not renewing policies for homes located within the affected and immediate surrounding areas.[8] Meanwhile, insurer losses have already resulted in requests for rate hikes.
In February, State Farm General — which writes a plurality of homeowners policies in the state — requested an emergency rate increase averaging 22% for certain California homeowners policies to maintain the company’s financial viability.[9]
Climate change is increasingly impacting homeowners’ finances
As insurers increasingly factor climate risks into insurance costs, homeowners are spending higher amounts on their monthly home payments. This is especially true in Florida and California, where high home values go hand in hand with soaring home insurance costs.
In Florida, the average home insurance deductible is 5% to 10% of the home’s value, a cost many homeowners can’t afford. Florida homeowners already pay 11 times as much for home insurance as homeowners in Vermont do ($954 versus $10,675).
On average, annual premiums in the 10 least stable states are 3.5 times more expensive than they are in the 10 most stable states ($1,354 versus $4,793). Not only do homeowners in the 10 least stable states risk a catastrophic event, but they’re also required to absorb high premiums to account for that risk.
Looking ahead, homeowners who remain in high-risk areas will have to shoulder more of the financial burden as rates rise nationally in 2025.
“Climate risks can vary from state to state, and home insurance prices will reflect the differences in potential exposure to losses,” Stella said. “As consumers consider moving to another state, they should research insurance costs as part of their budgeting process.”
Methodology
Insurify’s data science team analyzed various metrics related to home insurance for 50 states and Washington, D.C., including average insurance rate, changes in rates from 2023 to 2024, insurer loss ratios, frequency of major natural disasters, and the cost of major natural disasters per capita based on state population.
Insurify used these factors to create a final climate change adaptability score.
Frequency of major disasters (2020–2024): 25%
Cost of major disasters per capita (2020–2024): 25%
Average home insurance rate (2024): 25%
Change in home insurance rate (2023–2024): 12.5%
Insurer loss ratios (2019–2023): 12.5%
Major disaster data comes from the National Centers for Environmental Information page on Billion-Dollar Weather and Climate Disasters. Home insurance rates come from aggregated rate filings from Quadrant Information Services. Loss ratio data comes from RStreet’s 2024 Insurance Regulation Report Card.
Rates represent the average annual cost of an HO-3 insurance policy for homeowners with good credit and zero claims within the past five years covering a single-family frame house with the following coverage limits: $300,000 dwelling, $300,000 liability, $25,000 personal property, $30,000 loss of use, and a $1,000 deductible.
Insurify gathered Quadrant rates in representative ZIP codes in 10 of the largest cities in every state. Statewide costs reflect the average rate for homeowners across these ZIP codes.
For media inquiries or questions about our study, please contact the author here.
Commented