“The cost of property insurance remains the fastest-growing subcomponent of mortgage payments among current homeowners,” said Andy Walden, director of Mortgage and Housing Market Research at ICE.
Paying for property insurance has become one of the biggest challenges for homebuyers in the United States, reaching an increase of almost 70% in the last five years, outpacing the growth of other mortgage-related expenses.
This is according to ICE Mortgage Technology, a mortgage platform provider, in its September 2025 ICE Mortgage Monitor Report, published yesterday, October 8, which highlights the continued increase in property insurance costs and their growing impact on the overall affordability of mortgages.
The report revealed that the average annual property insurance payment for single-family mortgage holders has risen to nearly $2,370 a year, representing 9.6% of the averagemortgage-related, considering principal, interest, taxes and insurance (PITI).
According to the study, this represents the highest percentage ever recorded and underscores the disproportionate role that insurance costs play in the rise of homeownership expenses.
“The cost of property insurance remains the fastest-growing subcomponent of mortgage payments among current homeowners,” said Andy Walden, director of Mortgage and Housing Market Research at ICE.
“While mortgage principal, interest, and property tax payments have increased in recent years, insurance has far outpaced these gains, rising 4.9% in 2025, 11.3% annually, and nearly 70% over the past five and a half years. This rapid increase means that insurance alone consumes nearly one in ten dollars spent on average mortgage costs,” he noted.
Key findings on property insurance rate trends from the September Mortgage Monitor include:
- Slower but steady growth: Average property insurance payouts increased by 4.9% in the first half of 2025, raising annual costs by 11.3% year-on-year. While this figure is lower than the 7.3% increase seen in the first half of 2024, it still represents a historically high growth rate.
- Insurance costs vs. other mortgage components: Over the past five years, property insurance costs have increased by 70%, compared to increases of +23% for principal, +27% for interest, and +27% for property taxes.
- Cost per $1,000 of coverage: The average cost increased $0.29 (5%) over the past 12 months, and $0.85 (16%) since 2022, demonstrating that the increase in premiums is not only a function of higher home values, but also of higher costs for the coverage itself.
- Geographic disparities: California saw the largest increases in the first half of 2025, with premiums in Los Angeles rising 9% in just six months and 19.5% year-over-year. In contrast, Florida, historically one of the states with the highest property insurance costs, experienced some moderation, with smaller increases and even decreases in certain markets.
- State-backed plans: Florida has seen a sharp decline in homeowners relying on state-backed insurance plans, falling from 25% to 16% in the past 18 months, while reliance on such plans continues to rise in states like California and North Carolina.
“As property insurance costs continue to rise and represent an increasing portion of monthly mortgage expenses, homebuyers and homeowners face greater pressure to access financing,” said Tim Bowler, president of ICE Mortgage Technology.
About the ICE Mortgage Monitor
ICE manages the nation’s leading repository of residential mortgage performance data and information at the loan level, covering most of the market, including tens of millions of loans across the spectrum of credit products and more than 160 million historical records. The ICE Home Price Index provides one of the most comprehensive, accurate, and timely measurements of home prices available, covering 95% of residential properties in the U.S., down to the ZIP code level. In addition, the company maintains one of the most robust public property record databases available, covering 99.9% of the U.S. population and households in more than 3,100 counties.
