Is Your Home Insurance Skyrocketing? Here’s Why

By Mike Gray

When it comes to providing peerless customer service and fulfilling the needs of his clients, if Michael Gray tells you that “the sky’s the limit,” he’s not kidding. Formerly an airline pilot, where attention to detail and focus are crucial and following a process is absolutely necessary to achieve proper results, Mike learned early in his real estate career how well those skills transfer and how important they are to the buyers and sellers with whom he works.

In my last video, I asked you to send me some comments, questions, and insights that are relevant to the real estate industry, and I am happy that we got a great response from you. Right now, most concerns revolve around what’s happening with insurance.

To help us with that, I invited an expert, Jason Volkert, from Gibraltar Group-Insurance Services, to give us some valuable insights into the factors driving this unprecedented rise in insurance rates and their implications.

Question: I’ve noticed a significant increase in insurance rates over the past few years. Have you encountered this before?

Jason said that this surge in rates over the past three years is unprecedented. The main reason behind this rise in catastrophic events affecting Gulf Coast states like Texas. Reinsurance, which covers insurance companies themselves, has explained increased claims because of these disasters. Consequently, insurers are passing on these costs to policyholders, resulting in higher premiums.

Question: Who is affected by this trend?

This trend is affecting homeowners directly, with more frequent occurrences of hailstorms and other weather-related damages. The need for roof replacements has become more frequent, reducing the lifespan of roofs from what used to be 12 to 15 years to now just six to seven years.

Question: There have been reports of insurance carriers leaving high-risk areas like California. Are we seeing a similar trend in Texas?

Indeed, we’ve seen a couple of major insurance carriers exiting the Texas market recently. While some carriers remain committed to staying, they’re adjusting their strategies by revising rates more frequently and tightening underwriting criteria.

For homeowners, this translates to either higher premiums or reduced coverage as insurers become more selective in their policies.

Question: Looking ahead, is there any relief on the horizon for homeowners?

Unfortunately, the outlook suggests that these challenges will persist at least until 2025 or even into early 2026. While rates may stabilize, deductibles are likely to increase, and coverage may be further limited. In essence, we may see a flattening of rates, but not necessarily a decrease.

Insurance is still a critical consideration for both buyers and sellers. Older roofs, in particular, can impact negotiations during a home sale. Our team is dedicated to giving you valuable information, and we welcome any questions or topics you’d like to discuss. You can call, text, or email us anytime. We’d be happy to talk with you.