Climate
Rising Insurance Costs Are Driving People Out of These States
By Cal Hendricks · April 23, 2026
The average American homeowner paid $2,543 for home insurance in 2026. In Florida, that number hits $7,136, and projections put it above $8,400 by year's end. For many households, the math on staying simply no longer works.
The average American homeowner paid $2,543 for home insurance in 2026. In Florida, that number is $7,136, and it is projected to reach $8,458 before the year is out. For millions of homeowners, insurance is no longer a line item in the budget. It is the budget.
The States Where Insurance Is Becoming Unaffordable
Florida sits at the top of every expensive-insurance list, but it is not alone. Projected 2026 annual premiums for the worst-hit states tell the story clearly:
- Florida: $8,458
- Oklahoma: $5,205
- Louisiana: $5,035
- Nebraska: $4,560
- Texas: $4,529
Oklahoma and Nebraska surprise many people. Neither state gets the same media attention as Florida, but tornado exposure and severe hail events have pushed insurers to either raise rates sharply or exit those markets entirely. Fewer insurers competing means higher premiums for everyone left behind.
Why Rates Keep Climbing
Insurers price risk. When climate-driven events, construction costs, and litigation expenses all rise at the same time, premiums follow. Florida has layered an additional problem on top of weather risk: a legal environment that historically generated more homeowner insurance lawsuits than the rest of the country combined. Legislative reforms passed in recent years have slowed that trend, but the pricing damage is baked in.
California presents a different version of the same problem. Wildfire exposure has pushed several major carriers to stop writing new policies in the state entirely. Homeowners who cannot get private coverage are forced onto the FAIR Plan, the state's insurer of last resort, which offers limited coverage at high cost. The result is a growing class of California homeowners who are technically insured but practically underinsured.
Louisiana sits at the intersection of hurricane risk and a fragile private market. After repeated storm seasons, many carriers have already left. The remaining options are expensive and, in some cases, financially precarious.
Where People Are Moving Instead
The states with the lowest home insurance premiums in 2026 tell you something about where migration is heading. Hawaii averages $659 per year, the lowest in the country, though the overall cost of living there offsets much of that advantage. The Pacific Northwest, Vermont, and parts of the interior Northeast carry premiums well below the national average.
The more telling migration pattern is toward states that combine low insurance costs with low taxes. Idaho, Tennessee, and parts of the Carolinas show up repeatedly in relocation data. None of them are the cheapest for insurance, but they are not in the danger zone either, and they offer favorable income tax environments.
Retirees on fixed incomes feel this pressure more acutely than anyone. A $7,000 annual insurance bill is a manageable nuisance for a dual-income household. For someone living on Social Security and a pension, it can force a sale. If you are planning a retirement relocation, our guide to the Best States for Retirees to Avoid Taxes covers this intersection directly.
What Homeowners Should Actually Do
Comparing states on a single variable, insurance cost, misses the full picture. A state with low insurance premiums but high property taxes or high income taxes may cost you more in total. The household that moves from Florida to Tennessee to escape a $7,000 insurance bill needs to verify the complete cost stack before signing anything.
A $400,000 home illustrates the range. In Hawaii, you are paying roughly $659 per year to insure it. In Florida, that same home could cost $8,000 or more depending on location, age, and construction type. That is a $7,300 annual difference, or about $608 per month. Over ten years, the gap exceeds $73,000 before investment returns are factored in.
Use our state comparison calculator to run your specific numbers across insurance estimates, property taxes, income taxes, and cost of living in a single view.
Key Takeaways
- Florida's projected 2026 home insurance premium of $8,458 is more than three times the national average of $2,543.
- Oklahoma, Louisiana, Nebraska, and Texas all face projected 2026 premiums above $4,500, driven by severe weather exposure and thinning insurer competition.
- Hawaii has the lowest average premium at $659, but total cost of living comparisons matter more than any single number when deciding where to live.
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