Maine’s Home Insurance Rates Decrease, Defying National Trends
Maine stands out as a beacon of relative stability in a nation grappling with soaring home insurance costs. According to a recent report from Insurify, an online insurance comparison company, the state’s home insurance rates have actually decreased between 2023 and 2024, in stark contrast to the national trend of increasing premiums.
This outcome is especially significant considering the backdrop of consecutive multi-million-dollar natural disasters impacting other regions. With the rest of the country experiencing an average premium increase of 9%, Maine’s rates fell, earning it the highest score – a perfect 100 – on Insurify’s Home Insurance Climate Stability Index.
Geography Shields Maine from Climate Risks
The report credits Maine’s geographical isolation for its resilience. The authors noted that this geographic advantage shields Maine from the climate change-fueled wildfires and tropical storms that have ravaged other states between 2019 and 2024. Their analysis points out that Maine’s position helps protect it from major events, including hurricanes, which are often the most expensive types of disasters. These storms tend to lose strength by the time they reach Maine, due to cooler waters.
Like Maine, much of the New England region has also experienced stability. New Hampshire secured a close second, while Vermont and Massachusetts also made the top ten.
“Maine’s geography protects it from excessive natural disasters, including tropical cyclones, which are generally the most expensive types of disasters,” the authors wrote.
Maine and New Hampshire reported average annual insurance premiums around $1,200 in 2024, relative to the national average of $2,584. The authors acknowledged the extreme flooding that has affected all three states over the past two years, including the $480 million in damages Maine incurred from severe winter storms of last year. That figure, however, pales in comparison to the figures seen by the average state, which— according to Insurify data analysis manager Chase Gardner—has experienced five times the number of disasters at 35 times the cost.
“I think the biggest factor driving that is just the risk angle,” Gardner said. “The climate and natural disaster risk in Maine is so low in comparison to most other states.”
The report relies on a combination of Insurify’s internal data, information from a third-party insurance data aggregator, and public filings that insurance companies must submit to state regulators. Statewide averages are calculated from a broad range of ZIP codes, considering variation in both geography and demographics to provide an accurate view of each state’s insurance rates. According to Gardner, Maine’s data encompassed densely populated cities, smaller mountain and coastal communities, and towns in Aroostook County along the Canadian border.
The Climate Stability Index and Loss Ratios
Insurify’s Home Insurance Climate Stability Index grades states on a 0-100 scale. This rating uses several inputs, including disaster frequency, cost per capita of major disasters, the average home insurance rate, the change in insurance rates, and insurers’ losses compared to their premium revenues.
In addition to relatively infrequent and inexpensive disasters, Maine scored high because of its low average loss ratio. This means insurance claims aren’t outpacing insurers’ premium revenues like they do in states like Louisiana, which has the highest loss ratio in the country. Although Maine’s home insurance rates dropped 4% between 2023 and 2024, Gardner noted that insurance companies may take more than a year after a natural disaster to file for rate increases.
“At the minimum, I would say it would take six months” for insurance companies to respond to natural disasters with rate increases, “But in all likelihood, you probably have to wait a year, if not more, to kind of see the full effects of what a storm might have on an industry,” Gardner said.
Discrepancies and Cautions
An Insurify study published last February predicted a 19% increase in Maine’s insurance premiums, rising from $1,322 in 2023 to $1,571 in 2024. However, rates actually decreased to an average of $1,266 in 2024. This discrepancy may stem from an overemphasis on rates along Maine’s vulnerable coastline, according to Greg Thayer, a manager for Sanford-based Batchelder Bros. Insurance.
“When you look at Maine and see (average insurance premiums) going up 19%, that is slightly misleading,” Thayer said. “You’re not seeing that across the board. It really is focused on places with particularly high wind events… and a lot of that is driven by the coast.”
Gardner emphasized that Maine’s perfect stability score is relative and that the impact of climate change means New England’s safety from disasters isn’t guaranteed.
“We say Maine or New England is the most resilient, but hopefully that’s not interpreted as 100% resilient,” Gardner said. “There’s always the threat with climate change that something could happen,” such as the summer flooding events that hit Vermont in 2023 and 2024.
