New Research Finds Rising Insurance Premiums Influence Mortgage Delinquencies, Relocations

New research indicates that rising homeowners’ insurance premiums add to the financial burden of households struggling with mounting housing costs and could lead to mortgage delinquencies and even relocation.

The research paper, Home Insurance Premiums Influence Mortgage Delinquencies, Relocations, was released last week by Shan Ge, assistant professor of finance at New York University Stern School of Business, Stephanie Johnson, assistant professor of finance at the Jones School of Business, Rice University, and Nitzan Tzur-Ilan, senior research economist in the Research Department at the Federal Reserve Bank of Dallas.

“When insurance premiums rise, homeowners have limited ways to respond,” the paper said. “They can shop for cheaper coverage by switching insurers. Some people relocate to areas where insurance is less expensive. However, income-constrained households may be less likely to shop for lower-cost insurance and may find moving out of reach.”

“Instead, higher premiums can lead to greater reliance on credit cards, delayed mortgage payments and potential home loss. Because mortgages constitute a substantial share of household debt and bank assets, rising delinquencies can threaten broader financial stability,” the authors said.

The research said homeowners’ insurance premiums rose about 70% nationally between 2019 and 2025. “For the average homeowner, the insurance premium represented 14% of the monthly payment that includes mortgage principal and interest in 2025. That share compares with 10% in 2013, indicating that for many households over time, insurance has become a more substantial component of the monthly mortgage payment.”