How rising insurance rates in 2025 impact real estate professionals

The real estate landscape is shifting, causing challenges for real estate professionals in 2025. The impact of rising insurance rates on real estate includes home insurance rates climbing due to increasing claims costs, rising property values and the growing impact of natural disasters. Homebuyers and industry professionals are navigating a more complex market, and buyers are counting on professionals to help them through it, creating potential opportunities. By guiding buyers through the complexities of today’s market, real estate agents and mortgage brokers can position themselves as experts and reap the rewards.

The ripple effect of rising insurance costs

Home insurance premiums are expected to rise significantly in 2025 – by as much as 15% in some areas, with catastrophic peril coverage (like wind and flood insurance) spiking 20% or more. This, according to a VIU by HUB personal insurance marketplace outlook. Not only that, but insured losses hit $62 billion in just the first half of 2024 – 70% above the 10-year average. The premiums are driven up by those increased covered losses, but what is driving those? Extreme weather, updated FEMA flood maps, and insurance carriers pulling back from high-risk markets.

The impact of rising insurance rates on personal homeowners includes:

• Increased financial strain when purchasing or maintaining a home.
• Limited insurance options, especially in disaster-prone regions.
• A higher likelihood of deal delays or cancellations due to affordability concerns.

As many as two-thirds of consumers say extreme weather has affected their insurance, and 1 in 10 are uncertain whether they can afford to renew their policies. For real estate and mortgage professionals, understanding these dynamics – and their solutions – can keep transactions on track and build trust and long-term relationships with clients.

Simplifying the insurance journey

Rising costs and evolving risks don’t have to mean more headaches for homebuyers or challenges for real estate professionals. Turn obstacles into opportunities by integrating personal insurance solutions into their customer experience. Making it easy for buyers to compare coverage options and secure policies early in the homebuying process prevents last-minute disruptions – and builds loyalty.

Real estate and mortgage professionals can also help clients:

• Navigate affordability challenges by providing early insights on insurance costs.
• Explore risk mitigation strategies, particularly in areas prone to extreme weather.
• Find tailored insurance coverage that fits their needs, reducing financial stress.

With homebuyers increasingly prioritizing convenience, transparency and expert guidance, professionals who offer tech-forward solutions – like virtual property tours and real-time insurance quotes – stand out in a competitive market.

A frictionless path from search to closing

A smooth homebuying journey requires streamlined, digital-first solutions that address every aspect of the process, including insurance. By proactively guiding clients through coverage options, real estate professionals and lenders can remove roadblocks and help buyers feel more confident in their decisions.

More than just a transaction, insurance is a key part of a homeowner’s financial security. By providing unbiased, accessible guidance, professionals can transform insurance from a hassle into a valuable, reassuring step in the homebuying experience – building trust that lasts well beyond closing day.

The real estate market is evolving, and staying ahead means adapting to consumer needs. By leveraging technology, providing smart insurance solutions and educating clients on risk management, industry professionals can create a more resilient, customer-focused real estate experience. The result? Stronger transactions, stronger relationships and a stronger market.