Rising costs of homeowners’ insurance are affecting consumers, with Bloomberg warning policymakers against using simple solutions like capping premiums or subsidizing homebuyers. Instead, the editorial suggests increasing investment in catastrophe resilience and addressing factors that drive up claim costs, such as legal system abuse.
Bloomberg notes that higher insurance premiums have contributed to declining condominium prices and increased rents. According to the editorial, “Average homeowners insurance premiums rose almost 25 percent from 2019 to 2024 in real terms. Such costs have contributed to a slump in the condo market, with prices at a decade low, and are one reason for rising rents. New York City landlords with rent‑stabilized units reported an 18.7 percent increase in insurance costs in just one year.”
The editorial points out that while some politicians blame insurers for these increases, the issue is more complex. Factors include more frequent and severe disasters—insured losses from major catastrophes reached $108 billion in 2025—and insufficient state investment in disaster resilience measures like retrofitting public works and enforcing building codes. Rising legal costs are also cited as a significant driver of premium increases.
“In many states,” Bloomberg says, “underwriters must contend with laws that favor plaintiffs, outsized jury awards, and a proliferation of funds that specialize in financing lawsuits. Research suggests that such costs have been the single biggest driver of premium increases in recent years.”
Some legislative responses may worsen the situation for homebuyers. For example, Illinois recently saw increased government involvement in insurance pricing after legislators rejected a prior-approval system not found elsewhere in the country. Bloomberg also highlights California’s experience: “When California tried to artificially suppress premiums, underwriters fled the market and left homeowners and the state’s insurer of last resort exposed to last year’s horrific wildfires.” The state has since allowed substantial premium rate hikes to bring insurers back.
Bloomberg recommends states focus on strengthening buildings and infrastructure: “Tax breaks and grants for hardening homes against floods, fire, and wind are a short‑term expense with long‑term benefits,” the editorial says. Research indicates communities can lose up to $33 in future economic activity for every $1 not invested in preparedness. The Strengthen Alabama Homes program is mentioned as a successful model by providing grants up to $10,000 and discounts on wind-damage insurance for homeowners who install fortified roofs.
On federal policy, Bloomberg urges restoring FEMA’s pre-disaster mitigation program: “With strong oversight, such investment can protect property, limit job losses, accelerate rebuilding, reduce premiums, improve public health, and ultimately save money and lives.”
Addressing litigation trends is another recommendation; Florida enacted reforms limiting plaintiffs’ ability to allege negligence or recoup expenses from insurers: “In 2021, the state was home to 6.9 percent of homeowner claims but 76 percent of the lawsuits against insurers,” Bloomberg says. After reforms were passed over two years, at least 17 new insurers entered Florida’s market and dozens reduced premiums.
The Insurance Information Institute (Triple-I) supports stakeholders including consumers, media and policymakers by providing resources in English and Spanish through its official website. Triple-I represents over 50 member companies ranging from regional to global carriers (source) and offers data-driven insights on risk management (source). The organization aims to educate consumers and professionals about insurance issues without engaging in lobbying or sales (source).
“Triple-I, its members, and its partners are engaged in helping policymakers and the public understand the forces that affect insurance affordability and availability and how they can help mitigate the factors that drive up costs,” according to Triple-I.
