NAIC’s Homeowners Insurance Data Shows 2.2% Premium Increase for 2018-2019

Today, the National Association of Insurance Commissioners (NAIC) released its Dwelling, Fire, Homeowners Owner-Occupied, and Homeowners Tenant and Condominium/Cooperative Unit Owner’s Insurance Report: Data for 2019, which provides validated data on market distribution and average cost by policy form and amount of insurance.

The report compiles national and state-specific premium and exposure information for non-commercial dwelling fire insurance and for homeowners insurance package policies. It also contains data descriptions and a discussion of how certain economic, demographic, and natural phenomena impact the price of homeowners insurance. Data from the report was collected from insurance statistical agents for all states except Texas and California, which supply data directly to the NAIC. The report also includes select data from residual market mechanisms.

Key findings include:

• The countrywide average premium increased by 2.2% between 2018 and 2019.
• HO-3 average premium increased by 1.8% countrywide from 2018, while HO-4 average premium decreased by 2.8% between 2018 and 2019.
• HO-3 coverage accounts for 77.68% of owner-occupied exposures. HO-3 provides “all-risk” coverage on buildings and broad named-peril coverage on personal property.
• HO-3 accounts for 55.4% of all policy exposures and remains the most common policy sold by far.
• HO-4 coverage accounts for nearly 74% of the non-owner-occupied exposures. Tenant and condominium policies do not provide coverage for the building; therefore, the distribution of exposures for these types of policies is concentrated at significantly lower insurance amounts.

Many factors affect a state's expenditures and premiums, including underwriting costs, repair costs, and state laws. There are also differences in state requirements for insurance coverage, limits, and benefits. These variances make direct state-by-state comparisons difficult.