U.S. homeowners will pay more for new insurance policies in 2025 as factors like severe weather, reinsurance costs and inflation continues to force rate increases. At the same time, a neighborhood’s crime rate can impact how much policyholders spend to insure their home.
“This is the insurance industry’s way of accounting for the elevated likelihood of claims being filed in these neighborhoods,” according to a report by the home services platform Porch.
“While a high-crime area might offer lower property prices, the associated insurance premiums can quickly increase,” Porch said in the report. “Living in a low-crime area might come with higher upfront costs, but it often translates to more affordable insurance rates, saving you money in the long run and providing peace of mind.”
According to the latest data from Market Research Future, the crime insurance market peaked at $13.4 billion in 2023 and is predicted to reach $48.4 billion by 2032 at a compound annual growth rate (CAGR) of roughly 13.20% between 2024 and 2032.
Meanwhile, data compiled by Policygenius shows the average cost of homeowners insurance in the U.S. is $1,754 per year, or $146 a month. The exact amount depends on the policyholder’s zip code.
Due to rising rates, the average homeowner who bought their policy in 2021 paid nearly 69% more at their 2024 renewal, or an extra $865 annually. As of November 2024, rate growth showed signs of tapering, with the average increase for new policies dropping from 10.7% in the first half of the year to 6.6% in the second half, indicating early signs of stabilization.
Other factors impacting homeowners insurance include susceptibility to extreme weather damage, the estimated rebuild cost, age and characteristics of the home, the policyholder’s credit score, home's claims history and the policy deductible amount.
Using crime data compiled by World Population Review, the slideshow above illustrates the safest states to retire as selected by Seniorly.
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