J.D. Power study finds 47% of homeowners saw premium increases in past year, highest in over a decade
High-value customers most likely to leave insurers after repeated price hikes
Clear communication and options can ease dissatisfaction, study shows
Premium hikes drive customer defection
Almost half of U.S. homeowners insurance customers (47%) experienced a premium increase in the past year, the highest rate of insurer-initiated hikes in more than 10 years, according to the J.D. Power 2025 U.S. Home Insurance Study released Wednesday.
The trend is hitting the most profitable segment of the market especially hard. Among high-value customers—those with multiple policies and higher premiums—49% reported a rate increase. These customers are significantly more likely to switch insurers after repeated hikes, threatening long-term revenue streams for carriers.
“In a year marked by inflation, severe weather and tightening reinsurance markets, home insurance premiums have risen sharply in many parts of the country,” said Craig Martin, executive director of global insurance intelligence at J.D. Power. “While these increases often reflect real cost pressures, they’re also eroding trust and driving customers to shop for alternatives.”
Trust and loyalty eroding
The study found that 43% of customers who had a rate increase and do not plan to renew cited the price hike as their reason for switching. Trust levels also decline among those facing insurer-initiated increases, with customers reporting that carriers become harder to work with.
For high-value customers unlikely to renew, 45% cited repeated rate increases as the main driver of defection. Among low-value customers, the figure was just 30%.
Communication makes a difference
Insurers can mitigate the negative effects of premium hikes by proactively explaining the reasons behind increases and offering options to reduce costs, the study found. When customers fully understood the rationale and had choices, overall satisfaction averaged 721 out of 1,000—higher than customers who had no increase at all.
Amica ranked highest in the homeowners insurance segment with a score of 705, followed by Chubb (677) and Erie Insurance (676). In the renters insurance category, Amica also ranked first (711), ahead of Erie Insurance (705) and CSAA Insurance Group (689).
The 2025 study was based on responses from 14,511 homeowners and renters gathered between July 2024 and May 2025.