For three years, the homeowners insurance bill has been one of the fastest-rising costs in a household budget. That trend is finally losing steam. Price increases have slowed sharply in 2026, more homeowners are seeing their renewal premium go down, and insurers are competing for customers again instead of pulling back.
That matters for anyone who owns a home or insurance stocks. Reinsurance, the coverage insurers buy for themselves, has gotten much cheaper, first-half catastrophe losses were far lighter than the wildfire-hit start of 2025, and the industry is sitting on a $1.3 trillion capital cushion. The question for 2027 is how long carriers can keep trimming prices before loss costs catch up.
- Verisk and the American Property Casualty Insurance Association: the U.S. property/casualty industry posted a $31.7 billion underwriting gain in the first half of 2026, up from $11.6 billion a year earlier, and its combined ratio improved to 92.7 from 96.5.
- NerdWallet’s 2026 rates report: the typical home insurance premium rose 4.6% from early 2025 to early 2026, down from 10.8% the year before, and premiums fell in 18 states plus Washington, D.C.
- Guy Carpenter: U.S. property catastrophe reinsurance pricing is down about 16% so far in 2026, the largest annual decline for its U.S. index since 2014.
The price spiral is losing steam
The increases that defined 2023 through 2025 have not reversed, but they have clearly slowed. NerdWallet’s analysis of more than 840 million rate estimates found the typical premium climbed 7.0% from early 2023 to early 2024, then 10.8% the following year, when 29 states saw double-digit hikes. Over the latest 12 months the national increase slowed to 4.6%. A typical policy now costs about $2,564 a year, still 24% more than three years ago.
Renewal data from Matic, an insurance marketplace, tells the same story from the customer side. In the first half of 2026, 11.7% of homeowners who renewed saw their premium fall, the highest share Matic has recorded, up from 7.4% in 2025 and 4.9% in 2024. The average renewal increase was 10.6%, down from 19.4% in 2025 and 28% in 2024. The number of quotes available per shopper rose 27% from 2025.
The forward-looking signal is in rate filings with state regulators. NerdWallet found that from January through mid-August 2026, only 53.6% of homeowners filings asked for an increase, with a median requested change of +1.0%. In 2025 those figures were 68.7% and +5.4%; in 2024 they were 81.6% and +10.0%. That points to a calmer 2027 renewal season for many households.
Why the pressure is easing
Start with reinsurance. When reinsurers sharply raised prices in 2023, home insurers spent the next two years filing for higher rates to pass along the cost. Now the cycle is running the other way. Guy Carpenter’s U.S. property catastrophe rate-on-line index fell 12% at the January renewals and is down about 16% for 2026 after the June and July renewals. The index sits 22% below its 2024 peak. The broker credited benign losses, abundant reinsurer capital and a growing appetite for risk. Separately, the APCIA said states that passed legal reforms, including Florida, Georgia and Louisiana, have begun to see home and auto rate cuts.
Weather has helped too. The 2026 Atlantic hurricane season has been historically quiet so far: eight named storms and no hurricanes through late September, according to Verisk. A strong El Niño has increased wind shear over the Atlantic, and the season became the first since 1914 without a hurricane by Sept. 21. The season runs through Nov. 30, but its usual peak has passed.
Insurers are flush
Slower price growth has not hurt profits yet. Verisk and APCIA reported industry net income of $77.8 billion for the first half, up 53%, and policyholders’ surplus of $1.30 trillion, up from $1.13 trillion a year earlier. Net written premium growth, however, slowed to 2.1% from 5.2% in the first half of 2025 and a recent peak of 10.8% in the first half of 2024. In plain terms: margins are wide, but top-line growth is fading.
Company results show both halves of that picture. At Allstate, the homeowners combined ratio improved to 94.6 in the second quarter from 102.0, turning a $76 million underwriting loss into a $226 million profit. Homeowners policies in force rose 2.9% and new homeowners business jumped 16.4%, a sign the company is using its margin to win customers. At Travelers, the second-quarter combined ratio improved to 83.6% from 90.3% and personal insurance came in at 79.5%, while Homeowners and Other net written premiums slipped 3%.
Investment income is a second engine. With bond yields higher than they were a few years ago, insurers are earning more on the premiums they hold before paying claims. Travelers’ after-tax net investment income rose 14% in the second quarter, and Allstate’s net investment income rose by $255 million to about $1.0 billion.
Where relief is not reaching
The national averages hide real pain in certain places. NerdWallet found four states with double-digit increases over the past year, led by Pennsylvania at 16.4%, Arizona at 14.9% and Minnesota at 10.9%. Matic counted six states, including California, Florida and New Jersey, still facing double-digit increases. The Midwest has absorbed the biggest three-year rise, about 25%, after repeated hail and windstorms.
Those storms have not stopped. Gallagher Re estimated U.S. severe convective storm insured losses topped $35 billion by mid-August after an Aug. 9–12 outbreak across the Midwest, with six multibillion-dollar outbreaks this year compared with seven in all of 2025. Allstate’s underlying homeowners combined ratio, which strips out catastrophes, rose 2.9 points to 61.5 on higher loss costs. Rebuilding costs and claim severity are still climbing even as prices soften.
Older homes are paying more of the bill. NerdWallet found that a home built in 1984 now costs 81.2% more to insure than a comparable new build, up from 59.2% in early 2023, a gap of about $1,149 a year. Roof age is a large part of that difference.
What it means for homeowners
A softer market rewards people who shop. With insurers asking for much smaller increases and more carriers quoting, a competing offer is more likely to beat a renewal notice than it was a year ago. Compare the same coverage, not just the price.
Three other levers are worth a look. NerdWallet estimated that raising a deductible from $1,000 to $2,500 cuts premiums about 11.4%, if you have savings to cover the larger out-of-pocket cost. A single weather claim raises rates about 10.2% nationally, so small repairs may be cheaper to pay yourself. And check that your dwelling coverage still matches today’s cost to rebuild; construction costs have risen faster than many policies have been updated.
What investors should watch
Soft markets tend to follow a familiar arc: strong profits invite competition, competition pushes prices down, and margins narrow until losses force the next round of increases. Progressive offers an early hint. Its August combined ratio rose to 89.3 from 83.1 a year earlier, and net income fell 22%, even as premiums written grew 6%. That is still a profitable result, but it shows margins coming off their peak.
The next markers come quickly. Progressive reports September results on Wednesday, Oct. 14, and Travelers reports third-quarter results on Friday, Oct. 16. Watch three things: how fast renewal pricing is falling, whether underlying loss ratios are creeping up, and how much catastrophe losses from summer storms show up in the quarter. After that, the Jan. 1, 2027 reinsurance renewals will show whether insurers’ own costs keep falling.
For households, the takeaway is simpler. The worst of the insurance price spiral looks to be behind most homeowners, but premiums are resetting from a much higher base, and location still decides most of the bill. This article is general information, not personalized financial advice.
