Home insurance is taking a larger bite out of mortgage-related payments, even though premiums are rising more slowly than they were recently. In its September 2026 Mortgage Monitor, Intercontinental Exchange (ICE) put the average property-insurance payment for a single-family mortgage holder at a record $209 a month in the second quarter of 2026—9.6% of the average mortgage payment. Insurance-cost growth was 8.7% year over year, down from 11.4% at the start of 2026 and a 15.1% peak at the end of 2024. Slower growth is not a price cut.
How home insurance adds to a mortgage payment
Many mortgage borrowers pay property taxes and homeowners insurance through an escrow account included in the monthly mortgage bill. The Federal Reserve says mortgage holders generally are required to carry homeowners insurance and that payments sent to the lender typically include escrow for taxes and insurance. Arrangements vary, however: some homeowners pay their insurer separately, so a premium increase may not appear in the mortgage servicer’s monthly bill in the same way.
For borrowers whose premiums are escrowed, a higher insurance bill can raise the total monthly amount due even if principal and interest have not changed. ICE’s September 2026 report put insurance at 9.6% of the average mortgage payment in its dataset.
What “growth eases” means—and what it does not
ICE reported that property-insurance costs for single-family mortgage holders were up 8.7% year over year in the second quarter of 2026. That is slower annual growth than the 11.4% reported at the beginning of 2026 and the 15.1% peak at the end of 2024, but the average payment still reached a record $209 a month. The premium level rose; its rate of increase slowed. ICE’s September 2026 Mortgage Monitor reports the figures.
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The Dallas Fed said in April 2026 that premium growth was likely to ease through the end of that year, citing insurer profitability recovery and reinsurance rates beginning to decline. That was a forecast, not a guarantee or confirmation of what happened after the forecast was issued. The Dallas Fed’s analysis explains its outlook.
Why premiums have risen
Insurance prices reflect the expected cost of covering a home, and those costs differ by location and policy. The Dallas Fed identifies several pressures on premiums: higher construction and rebuilding costs after the pandemic, greater insured losses from natural disasters, more households moving into disaster-prone areas, and rising reinsurance costs. Local construction costs, hazard exposure and state regulation also matter.
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ICE’s September 2026 analysis attributed roughly two-thirds of the latest year’s increase to higher coverage limits; the cost per $1,000 of coverage rose 3%. That distinction matters: a larger insured amount can increase a premium even when the price charged for each unit of coverage rises less quickly.
Why national estimates of premium increases differ
Two often-cited national figures measure different things. The Dallas Fed, using ICE McDash data, reported that homeowners insurance premiums rose 62% in dollar terms from 2019 to 2024. The Government Accountability Office (GAO) found a 3% increase in the average premium over the same period after adjusting for inflation. One is a nominal change; the other is inflation-adjusted, so they are not competing estimates of the same measure.
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Inflation indexes can also diverge from the premium a homeowner actually pays. For 2019–2024, the Dallas Fed reported a 62% increase in ICE McDash premiums, a 35% increase in the PCE net household-insurance component and a 5% increase in CPI’s tenants-and-homeowners insurance component. CPI uses renters-insurance premiums for this component, while PCE nets out expected claim losses. These indexes are designed to measure consumption inflation, not the full affordability burden of a homeowner’s gross premium. The Dallas Fed’s comparison describes the methods.
Where the burden is highest
National averages conceal wide local differences, and each comparison answers a different question. ICE found that property insurance represented 24.3% of the average mortgage payment in New Orleans and 4.3% in San Jose. Those figures are shares of mortgage payments, not a comparison of premium growth or the price quoted for a particular house.
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GAO’s inflation-adjusted analysis found premiums rose 25% or more in some southern coastal areas between 2019 and 2024, despite a 3% national increase. It also found that premiums were highest relative to median household income in Florida, Louisiana and Oklahoma. In GAO’s estimates, homes in high-wind-risk areas had premiums about 58% higher than similar homes in medium-wind-risk areas; moving from medium to high wildfire risk was associated with an 8% increase. These are statistical estimates, not a quote or prediction for an individual property. GAO’s 2026 report details its findings.
Other measures point to pressure on household budgets. Urban Institute found that insurance premiums at loan origination rose from 1.87% of income for loans made in 2018 to 2.27% for loans made in 2024. It found higher cost burdens among borrowers with low incomes, lower credit scores, higher debt-to-income ratios and borrowers in high-hazard areas. The measure compares premiums with borrower income at origination, rather than insurance’s share of a monthly mortgage payment. Urban Institute’s analysis provides the comparison.
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Treasury’s Federal Insurance Office analyzed more than 246 million policies aggregated by ZIP code from 2018 to 2022. It found premiums per policy rose 8.7% faster than inflation over that period and average nonrenewal rates were about 80% higher in the highest-risk ZIP codes than in the lowest-risk ZIP codes. The peril set in that analysis excluded flooding, which standard homeowners policies typically do not cover. Treasury’s analysis describes the scope and results.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What rising premiums mean for coverage and affordability
Higher premiums can force difficult trade-offs between the cost of insurance and the protection a household wants. In the Federal Reserve’s 2025 household survey, 20% of insured homeowners said they wanted more coverage but could not afford it, while 14% said they struggled to afford premiums. More than six in 10 insured homeowners said premiums had risen more than they expected in recent years. Those survey responses describe reported experiences, not the share of all homeowners who are underinsured. The Federal Reserve’s household survey reports the results.
How to compare renewal offers
Shopping around may help, but a lower price is useful only if the policy still meets the household’s needs. ICE reported that borrowers who switched private carriers over the prior year had average payments 6.6% lower, while those who stayed saw costs rise 10.4%. This is an observed comparison between groups, not a guaranteed saving for any individual homeowner.
When comparing offers, line up the policies rather than looking only at the premium:
- Total premium: Compare the full cost for the same coverage period, including any fees shown in the offer.
- Coverage limits: Check the dwelling limit and other limits against the protection you need; a lower limit can make a quote look cheaper.
- Deductibles: Note the amount you would pay before coverage applies, including any separate deductibles for specific perils.
- Covered perils and exclusions: Confirm what the policy covers and what it excludes; do not assume all offers protect against the same risks.
- Renewal terms: Review how the insurer can change the premium or terms at renewal.
ICE said recent switchers, on average, also obtained lower deductibles and more coverage than borrowers who stayed. That group-level finding does not establish that every switching offer improves both price and protection. Compare the actual policy documents and terms before choosing.
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