Home insurance premiums in Indiana are experiencing a significant surge, with the average cost increasing by 16% or $412 between 2021 and 2024, according to a recent report from the Fair Housing Center of Central Indiana. This rise has led to an increase in policy cancellations due to nonpayment, with one in every 54 policies, or 1.8%, being canceled in 2022.
The report highlights that the Indianapolis metropolitan area saw a similar increase of 16.5%, or $440, during the same period. The data was sourced from a study by the Consumer Federation of America, which used ‘test quotes’ for a typical home with a replacement value of $350,000 and a homeowner with mid-tier credit.
The center criticized the limited data available and called for greater transparency in the insurance industry. The report noted that the estimated average Indiana home insurance premium of $2,567 in 2021 was already higher than other estimates, such as the National Association of Insurance Commissioners’ average policy cost of $1,058.
Some counties in Indiana experienced even higher rates of policy cancellations due to nonpayment. Fayette, Blackford, Vermillion, and Sullivan counties saw rates at least twice as high as the state average, with one ZIP code in Jennings County recording a staggering 16.7% cancellation rate.
In addition to cancellations due to nonpayment, 1.2% of policies statewide were not renewed by insurers in 2022. The report explained that nonrenewal typically occurs when an insurer views a home or homeowner as too risky to continue coverage, often due to aging homes requiring expensive repairs or increased risk of natural disasters.
The Fair Housing Center of Central Indiana emphasized the importance of home insurance in maintaining safe homes and preserving homeowners’ wealth. However, the rising premiums have strained existing homeowners’ budgets and pushed homeownership further out of reach for many.
