Maine’s home insurance market has weathered a year of significant natural disasters remarkably well, according to a recent report from Insurify, an online insurance comparison company.
While the United States saw an average premium increase of 9% between 2023 and 2024, Maine experienced a decrease in home insurance rates. This performance earned the state the top score on Insurify’s Home Insurance Climate Stability Index, achieving a perfect 100.
This stability reflects Maine’s relative isolation from the climate change-aggravated wildfires and tropical storms that have impacted many other states from as far back as 2019 through 2024, the report indicates. “Maine’s geography protects it from excessive natural disasters, including tropical cyclones, which are generally the most expensive types of disasters,” the authors wrote, adding that “Those storms rely on warm water and tend to cool and lose strength by the time they’ve reached Maine.”
New England overall has shown relative stability with its home insurance rates in the face of a changing climate. New Hampshire followed closely behind Maine, and Vermont and Massachusetts also ranked among the top 10 states for stability.
In 2024, the average annual insurance premiums in both Maine and New Hampshire hovered around $1,200, a figure less than half the national average of $2,584.
The report’s authors did acknowledge the extensive flooding in all three states over the past two years as well, including the $480 million in damages that Maine incurred from winter storms and summer floods in 2024. However, this figure is still far less than the national average. Data analysis manager Chase Gardner from Insurify noted that the average state has faced five times as many disasters at 35 times the cost.
“I think the biggest factor driving that is just the risk angle,” said Gardner in an interview. “The climate and natural disaster risk in Maine (is) so low in comparison to most other states.” Gardner added that the report’s analysis used a combination of Insurify’s proprietary data, data from a third-party insurance data aggregator, and public data that insurance companies are mandated to submit to state regulators before they raise premiums.
Statewide averages are calculated using premium data from a variety of ZIP codes, factoring in diverse geographies and demographics to give an accurate picture of each state’s insurance rates. According to Gardner, Maine’s data set factored in densely populated cities, smaller mountain and coastal communities, as well as Aroostook County towns, which are situated on the Canadian border.
The Home Insurance Climate Stability Index developed by Insurify is graded on a scale from 0 to 100. It assesses factors such as the frequency and cost of major disasters per capita, the average home insurance rate, how insurance rates have changed, and the ratio of insurers’ losses compared to their premium revenues.
In addition to experiencing relatively few and inexpensive disasters, Maine also scored favorably on the index because it has the second-lowest average loss ratio in the country. This indicates that insurance claims in Maine are not exceeding insurers’ premium revenues. Louisiana holds the highest loss ratio in the United States.
Despite a 4% drop in Maine home insurance rates between 2023 and 2024, a period marked by substantial flooding events, Gardner cautioned that insurance companies may take more than a year to raise rates after a natural disaster. This suggests that Maine’s current insurance stability isn’t necessarily guaranteed.
“At the minimum, I would say it would take six months” for insurance companies to respond to natural disasters with rate increases, Gardner said. “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.”
Notably, a separate Insurify study released in February of last year had projected that Maine would see one of the largest year-over-year insurance premium increases, rising from $1,322 in 2023 to a projected $1,571 in 2024. Instead of that projected 19% increase, Maine insurance rates went down to an average of $1,266 in 2024.
Greg Thayer, a manager at Batchelder Bros. Insurance, which is located in Sanford, noted that this discrepancy may be because the early projections had overestimated the increases for Maine’s insurance in high-risk coastal areas.
“When you look at Maine and see (average insurance premiums) going up 19%, that is slightly misleading,” Thayer told The Monitor in an interview last July. “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 the perfect stability rating given to Maine in this most recent Insurify report should be viewed in context. The volatility introduced by climate change means that neither Maine, nor any part of New England, can guarantee that they will remain untouched by the same types of disasters that are hitting other states.
“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,” an example being the successive summer flooding that struck Vermont in 2023 and 2024. This demonstrates similar caution should be taken when interpreting other reports, as one part of New England’s data set could change quickly.
This story was originally published by The Maine Monitor, a nonprofit and nonpartisan news organization.
