Home insurance premiums in the United States have risen sharply over the past decade, now exceeding average property tax bills in approximately two-thirds of counties, according to a recent analysis by Bloomberg Intelligence. This trend highlights growing financial pressures on households amid escalating costs driven in part by extreme weather events linked to climate change.

The analysis found that homeowner insurance rates, adjusted for inflation, have increased by an average of 45% nationally over the last ten years. However, some states have experienced significantly larger hikes, such as Nebraska, where premiums have risen by nearly 79%. When factoring in auto insurance premiums affected by weather-related claims, the combined cost surpasses property taxes in about 75% of counties across the country.

Regional variations are pronounced. In the Midwest and Mountain West, including states like Colorado, Utah, and Minnesota, frequent hail and winter storms are major contributors to rising insurance rates. Meanwhile, southeastern states—which generally have lower property tax burdens—now face insurance premiums that can be two and a half to four times greater than their tax levies. Conversely, in many Northeastern and Western states and large metropolitan areas where property taxes are higher, soaring insurance costs represent a smaller share of the overall tax burden.

This surge in insurance expenses comes amid broader fiscal challenges for local governments. With federal disaster recovery funding declining relative to local contributions, municipalities are encountering new budgetary strains. Historically, the federal government covered about 90% of disaster recovery costs over the past two decades, but this ratio is shifting toward an almost equal split between federal and local funding. For instance, after Hurricane Harvey in 2017, Texas received $23 billion in federal aid compared with $4 billion from local sources. In contrast, following the 2025 Los Angeles wildfires, California received $2.6 billion in federal support while local entities spent approximately $3.5 billion.

Andrew John Stevenson of Bloomberg Intelligence noted that this evolving dynamic places a heavy burden on local governments, which often lack the financial reserves to respond swiftly to disasters and would prefer to invest in long-term infrastructure improvements instead of emergency rebuilding efforts. Insurance deductibles for homeowners have also increased, shifting more immediate recovery costs onto families and reducing disposable income that might otherwise fuel local economies through spending on services and entertainment.

The financial toll of natural disasters has escalated in recent years, too. Losses reached an average of $156 billion annually over the past five years, adjusted for inflation—about ten times the level seen in 1985, according to data from the research organization Climate Central. This trend could exert additional pressure on municipal bond markets as communities prioritize recovery over growth.

Despite the rising costs, insurance experts emphasize its continued necessity in the face of growing climate risks. Alexandra Glickman, global practice leader for real estate and hospitality at Arthur J. Gallagher & Co., advised homeowners to recognize their evolving exposures and be prepared to pay higher premiums to protect their assets. “You can’t necessarily stop Mother Nature,” she said, “but you can make it home” by taking appropriate precautions and securing adequate coverage.