"Small decreases in the frequency and cost of claims have helped improve insurer financial performance, resulting in a continuing moderation in the cost of homeowners insurance in 2005," said Robert Hartwig, senior vice president and chief economist for the I.I.I.

"With the cost of owning a home in America skyrocketing?sale prices, local property and school taxes, energy costs, and interests rates on the rise?the moderation in home insurance costs couldn't come at a better time for homeowners," he said.

Mr. Hartwig said some of the increase in the cost of homeowners insurance reflects choices made by consumers themselves.

"Over the past several years, millions of families took advantage of near-record low interest rates, purchased larger homes, or made additions and improvements to their existing homes in record numbers," he said. "Bigger, newer and upgraded homes cost more to insure simply because they're more expensive to rebuild or repair," according to the I.I.I.

Approximately 41 million homeowners have added to or improved their homes between 2001 and 2002. In 2003, the most recent year for which annual figures were available, an estimated $177 billion was spent on home improvements, the I.I.I. said.

Mr. Hartwig said, "Insurers are now protecting more homes at greater value than at any time in history, helping propel the home ownership rate to an all-time record high of 69.2 percent in the fourth quarter of 2004?a figure substantially influenced by record numbers of minority buyers."

Examining losses, I.I.I. reported that between 1990 and 2002, home insurers paid out, on average, $1.17 in losses and expenses for every $1 they earned in premiums.

According to I.I.I., between 2000 and 2002 alone, homeowners insurers paid out an estimated $13.5 billion more in claims than they collected in premiums, rivaling the $15.5 billion in insured losses from Hurricane Andrew?still the single most expensive natural disaster in history in terms of insured losses.

I.I.I. noted that by 2003 results improved substantially, with insurers paying out an estimated 98 cents for every dollar earned, though last year's four hurricanes pushed losses to an estimated $1.01 on each dollar earned.

During the 1990s, I.I.I. noted, the severity of catastrophes began to increase dramatically. Since 1990, I.I.I. said, insurers have paid out nearly $150 billion in catastrophe-related losses?about $830 million per month.

Catastrophes include well-known events such as Hurricane Andrew and the Northridge earthquake, and also hundreds of smaller disasters associated with tropical storms, tornados, wildfires, hail and severe winter weather.

In 2004, I.I.I. said, insured natural disaster losses hit a record $27.3 billion. Some sources put the figure even higher. The quartet of Hurricanes Charley, Frances, Ivan and Jeanne cost insurers $22.6 billion, said I.I.I., accounting for 83 percent of all catastrophe losses in 2004.

Mr. Hartwig said, "Homeowners insurance rates in some parts of the country continue to rise because of the extraordinary costs associated with paying these catastrophic claims. In fact, virtually every part of the country is either at risk of or has experienced a billion-dollar disaster."

While the typical American homeowner will pay $677 for home insurance in 2005, rates do vary significantly from one part of the country to another, I.I.I. reported, noting that homeowners in catastrophe-prone states are likely to have the biggest affordability issues.

Mr. Hartwig also pointed out that many homeowners in coastal regions vulnerable to devastating storms assume a larger portion of the risk through higher deductibles?usually a percentage of the insured value of the home.

The I.I.I. is a nonprofit, communications organization sponsored by the property/casualty insurance industry.