By guest blogger SES Risk Solutions
The property insurance industry in the United States is experiencing significant changes, driven by evolving risk factors, economic adjustments, and regulatory updates. While challenges such as rising premiums and catastrophic events persist, innovative solutions, market adaptability, and risk mitigation strategies are creating opportunities for investors, insurers, and property owners. Read on to discover trends in five key states—Florida, California, Texas, Ohio, and North Carolina—highlighting challenges and providing a glimpse at what may be next for property insurance.
Insurance company changes and what it could mean for investors
Insurance companies are shifting strategies in response to growing risks from extreme weather and other challenges. Companies like State Farm and Allstate have refined their underwriting approaches in states like California and Florida, allowing for a more balanced risk spread. While some carriers have reduced offerings in high-risk zones, new entrants and specialized providers are stepping in to fill the gap and better suit specific property needs.
State-backed programs, such as California’s FAIR Plan and Florida’s Citizens Property Insurance Corporation, are evolving to meet growing demand. Florida’s Citizens, now the largest home insurer in the state, is working on transitioning policyholders back to the private market through incentive programs and risk-sharing mechanisms. For property investors, these adjustments could mean more insurance options and potentially lower costs if you leverage available programs wisely.
Keeping rates under control
While premiums have been creeping up in many markets, insurers and regulators are collaborating to promote stability. Nationwide, average home insurance premiums rose by approximately 6% in 2024, though regulators in states like Texas and North Carolina have stepped in to keep rate hikes under control.
Risk mitigation efforts, including updated building codes, improved property resilience measures, and proactive disaster preparedness programs, are playing a key role in stabilizing costs. Property owners investing in protective measures—such as storm-resistant materials, flood mitigation techniques, and fire-resistant landscaping—are increasingly benefiting from premium discounts and expanded coverage options.
Adapting to climate and catastrophic events
Extreme weather events—like wildfires in California or floods in Florida—are increasingly influencing the cost and availability of insurance. The good news? Insurers are adapting, using better technology and smarter strategies to help keep insurance accessible.
For example, in California, wildfire mitigation programs and defensible space initiatives are reducing risk exposure and creating more insurability options. Similarly, Florida’s coastal communities are leveraging new flood-resistant building designs and infrastructure improvements to enhance long-term sustainability.
Insurance providers are also collaborating with policymakers to develop innovative solutions, such as parametric insurance products, which offer rapid payouts based on event triggers rather than lengthy claims processes. These new insurance models are improving resilience and financial security for property owners facing unpredictable weather patterns.
Regional insurance insights for real estate investors
- Florida: With hurricane preparedness programs and enhanced reinsurance structures, Florida is working toward greater market stability. Insurers are incentivizing storm-proofing measures to help policyholders manage costs effectively.
- California: Advancements in wildfire risk assessment and mitigation programs are making insurance more accessible. The state’s FAIR Plan is expanding coverage options while encouraging private market participation.
- Texas: Regulatory efforts are helping to moderate rate increases, and improved flood mitigation infrastructure is reducing long-term exposure to extreme weather events.
- Ohio and North Carolina: While these states have experienced localized severe weather events, proactive regulatory oversight and improved risk assessment tools are maintaining market competitiveness.
Looking ahead: Protect your investments in a changing market
As the property insurance landscape continues to change, real estate investors face both challenges and valuable opportunities. By staying informed, embracing protective measures, and proactively managing your insurance strategy, you’ll not only reduce your risk but also enhance the profitability and resilience of your investments.
For real estate investors, that also means having the proper coverage for your investment property. Rentals and other investment properties carry unique risks that aren’t covered by standard homeowner’s insurance.
Don’t leave your property’s financial future to chance. Ensure your investment properties have the right insurance coverage for today’s evolving risks.
Request your personalized insurance quote and safeguard your investment for whatever comes next.
About SES Risk Solutions
SES is a leading property and casualty program administrator focused on delivering innovative real-estate insurance solutions. SES empowers brokers and fiduciaries that serve both investors and financial institutions by combining insurtech platforms, market-leading carriers, and over 35 years of expertise, providing a simplified, yet uncompromising, insurance experience.
SES Risk Solutions is not an affiliate of Equity Trust Company. Opinions or ideas expressed are not necessarily those of Equity Trust Company nor do they reflect their views or endorsement. These materials are for informational purposes only. Equity Trust Company, and their affiliates, representatives and officers do not provide legal or tax advice. Investing involves risk, including possible loss of principal.
Equity Trust Company’s arrangement with this third party provider is solely for the convenience of clients of Equity Trust Company. Equity Trust Company makes no recommendation or representations as to this third party provider, any insurance products, or the insurance needs generally of any client or any client’s account. Clients are in no way obligated to purchase insurance products generally or to purchase insurance products from this third party provider or through Equity Trust Company’s arrangement with this third party provider. Clients are free to purchase or not purchase insurance products for client or client’s account from any insurance company or broker as they deem appropriate. No client may rely on any statement made by Equity Trust Company or any of its officers, directors, employees, or agents for any decisions regarding the purchase of insurance products. Clients should consult with their financial and legal advisors before purchasing any insurance product for client or client’s account.
Equity Trust Company is a directed custodian and does not provide tax, legal, or investment advice. Any information communicated by Equity Trust is for educational purposes only, and should not be construed as tax, legal, or investment advice. Whenever making an investment decision, please consult with your tax attorney or financial professional.
