If your rental property insurance is going up in 2026, you are not necessarily doing anything wrong. Insurance premiums can increase because of changes in replacement costs, severe-weather risk, reinsurance costs, the age or condition of the property, claims trends in your area, changes to coverage, and broader insurance market conditions.
And yes, your premium can go up even if you personally have never filed a claim.
For landlords, though, the insurance renewal is only part of the story. If insurance has gone up while property taxes, repairs, maintenance, and other expenses are also climbing, it may be time to recalculate what the rental is actually putting in your pocket.
Quick answer: Why is my rental property insurance going up?
Common reasons include higher rebuilding and repair costs, increased weather and catastrophe risk, changes in your property’s characteristics, insurer claim experience, reinsurance costs, inflation, coverage changes, and broader conditions in the property insurance market. Your specific reason should be confirmed by reviewing your renewal documents and talking with your insurance agent or carrier.
Property Insurance Costs Are a Real Issue in 2026
It is important not to throw every landlord in the country into the same bucket. Insurance pricing is highly dependent on the property, location, coverage, insurer, and risk.
But there is real evidence that property insurance costs have become a bigger issue for property owners.
2026 GAO Report
The U.S. Government Accountability Office found that average homeowners insurance premiums increased about 27% nationally from 2019 through 2024 before adjusting for inflation.
Higher-Risk Areas
GAO also found much larger inflation-adjusted increases in some areas, particularly locations facing higher natural-disaster risk.
Rental Housing
A Federal Reserve Bank of Minneapolis survey also found steep insurance increases among the multifamily rental owners who participated.
Important context: the GAO figures above are for homeowners insurance, not landlord policies specifically. The Minneapolis Fed research covered a limited survey of multifamily owners in Minnesota, Montana, North Dakota, and South Dakota, so its results should not be treated as a national average for all rental properties. Both are useful indicators of the broader property insurance environment.
7 Reasons Your Rental Property Insurance May Be Going Up
Your insurance company should be able to explain what changed on your specific policy. But if you are staring at a renewal that suddenly costs more, these are some of the major factors worth investigating.
Reason 1
It Costs More to Repair or Rebuild the Property
Insurance is affected by what it could cost to repair or replace damaged property. Labor, construction materials, equipment, and local rebuilding conditions can all affect those costs. If rebuilding becomes more expensive, the amount of insurance needed to protect the property can also change.
Reason 2
Weather and Catastrophe Risk Have Changed
Insurers consider the likelihood and potential cost of losses. Depending on where the property is located, wind, hail, wildfire, hurricanes, severe storms, and other hazards may affect insurance pricing and availability.
Reason 3
Your Property Itself May Be Rated Differently
The age of the roof, plumbing, electrical system, heating system, construction materials, fire protection, and overall condition of a property can affect how an insurer evaluates the risk.
Reason 4
Your Coverage or Replacement Value Changed
Do not assume a higher bill means the exact same policy simply became more expensive. Compare the old policy with the renewal. Coverage limits, replacement-cost estimates, deductibles, endorsements, and other terms may have changed.
Reason 5
Claims Can Affect More Than One Property Owner
Your own claims history can matter, but insurers also price for broader expected losses. Severe losses in a region or changes in expected future losses can affect insurance markets even if your specific rental has never had a claim.
Reason 6
Reinsurance Costs Can Affect Insurers
Insurance companies buy insurance of their own, called reinsurance, to help manage large losses. The National Association of Insurance Commissioners lists reinsurance costs among the factors that can contribute to higher insurance premiums.
Reason 7
The Insurance Market Changes
Insurance markets move through periods when coverage is easier or harder to obtain and when insurers change underwriting standards or pricing. That means your renewal can be affected by factors well beyond what happened at your individual rental.
“But I Never Filed a Claim. Why Did My Insurance Go Up?”
Because your individual claims history is only one part of insurance pricing.
Your premium can also be affected by replacement costs, property characteristics, regional losses, weather risk, reinsurance, changes in coverage, and the insurer’s broader pricing and underwriting decisions.
Why Higher Insurance Can Make Your Mortgage Payment Go Up
This one catches landlords off guard all the time.
If insurance is paid through your mortgage escrow account, an increase in the insurance premium can increase the amount collected as part of your monthly housing payment.
PITI = Principal + Interest + Taxes + Insurance
Even with a fixed-rate mortgage, the principal and interest portion may stay the same while taxes or insurance change. That means your total monthly PITI can still increase.
For a landlord, that matters because higher PITI means less money left over from the same rent check.
What a Higher Insurance Premium Does to Rental Cash Flow
A premium increase can look small when you see it as a monthly number.
Look at it over a full year and the impact becomes easier to see.
| Monthly Insurance Increase | Added Annual Cost |
|---|---|
| $50 per month | $600 per year |
| $100 per month | $1,200 per year |
| $200 per month | $2,400 per year |
| $300 per month | $3,600 per year |
If rent stays the same, an additional $200 per month in insurance expense is $2,400 per year that is no longer contributing to your rental cash flow, before considering any tax effects.
Now add an increase in property taxes, a new water heater, a month of vacancy, or another repair on top of it. That is why looking only at gross rent can give landlords a very incomplete picture.
Recalculate the Rental, Not Just the Insurance
If your insurance jumped, pull out the whole property budget.
What matters is not what the property rents for. What matters is what is left after the property gets paid first.
What Should a Landlord Check When the Insurance Renewal Goes Up?
Do not look at the new premium and stop there. Put last year’s policy next to the renewal and work through it line by line.
Premium
How much did the annual premium actually change?
Coverage Limits
Did the insured or replacement value increase?
Deductible
Did your deductible or a separate wind or hail deductible change?
Coverage
Were endorsements, exclusions, or other policy terms changed?
Property Details
Is the insurer using accurate information about the roof, systems, occupancy, and property?
Discounts
Ask whether any discounts, protective-device credits, or other savings are available.
Questions to Ask Your Insurance Agent
You do not need to become an insurance expert. You just need to ask better questions.
- What specifically caused my premium to increase?
- Did my coverage limits or replacement-cost estimate change?
- Did any deductibles change?
- Were any exclusions or endorsements added?
- Is the age of my roof or another property feature affecting the rate?
- Are there improvements that could qualify the property for a discount?
- Are there discounts I am currently missing?
- Can you quote comparable coverage with another carrier?
- Would changing the deductible materially lower the premium, and what additional risk would I take on?
If you have a mortgage, also make sure any coverage changes still satisfy your lender’s insurance requirements.
Do Not Cut Coverage Just to Make the Number Look Better
A lower premium is not automatically a better deal. A higher deductible or reduced coverage can shift more financial risk back to you. Understand exactly what you are changing, what your lender requires, and what you could afford to pay if something actually happens.
Can You Just Raise the Rent to Cover Higher Insurance?
Maybe, but higher expenses do not automatically mean the market will support higher rent.
You still have to consider the lease, local market rent, tenant demand, applicable laws, and whether increasing the rent creates a higher risk of turnover or vacancy.
If your costs rise $200 per month but your market only supports another $50 in rent, the property still has a $150 monthly problem.
This Is the Number Landlords Should Recalculate
If insurance has gone up, do not ask only, “Can I afford the new premium?”
Recalculate the entire rental.
Run the whole property again
Rent collected – mortgage/PITI – repairs – vacancy – management – owner-paid expenses = a much more useful picture of your rental income.
Then look beyond one month.
What did the property actually produce over the last 12 months?
- How much rent did you actually collect?
- How much did insurance cost?
- How much did property taxes cost?
- How much did you spend on repairs?
- Was there any vacancy or missed rent?
- Did you pay a property manager?
- How much time did you personally spend dealing with the rental?
When Higher Insurance Is a Sign to Look at the Whole Investment
One insurance increase does not automatically mean you should sell a rental property.
But if the insurance renewal is just one more expense hitting a property that was already getting harder to justify, it may be the right time to look at your options.
Pay attention if several of these are happening at the same time:
- Insurance is increasing
- Property taxes are increasing
- Repairs are becoming more frequent
- Net cash flow is getting thinner
- You are worried about the next major repair
- Vacancy or turnover is eating into returns
- You are spending more time managing the property
- You still want income, but you are tired of being responsible for the rental
Keep Renting, Sell, or Change the Income Structure?
Once you know what the rental is actually producing, you can compare the paths available to you.
Option 1
Keep Renting
If the rental still produces income you are happy with and you want to keep owning it, the higher insurance bill may simply be another expense to manage.
Option 2
Sell Traditionally
If you want a clean exit and access to the property’s equity, a traditional sale may be worth comparing.
Option 3
Explore Rental Conversion
If you want to stop being the landlord but still want to explore monthly income, an owner-financed sale may give you another structure to compare.
What Does Insurance Have to Do With Rental Conversion?
More than you might think.
Insurance is part of the cost of continuing to own the rental. When that cost rises, your current rental income may look different.
Rental conversion is a strategy where the rental property is sold through owner financing. The buyer becomes the property owner, and the seller receives payments according to the terms of a promissory note instead of continuing to collect rent as the landlord.
That changes the relationship entirely. Instead of comparing only “keep the rental” against “sell and give up the income,” a landlord can also evaluate what the property could look like as an owner-financed note.
Your Insurance Changed. Update the Numbers.
See What Your Rental Looks Like Now
Colonial Funding’s Rental Conversion Calculator uses your monthly PITI as one of its inputs.
If your insurance increased, use your updated monthly PITI so you are comparing today’s rental numbers, not what the property cost you a year or two ago.
What You Need for the Rental Conversion Calculator
You do not need a stack of documents to get a quick estimate.
Have these four numbers ready:
1
Estimated Sales Price
2
Monthly Rent
3
Monthly PITI
4
Underlying Loan Balance
The calculator gives you a starting-point comparison between your estimated monthly net rental income and a possible owner-financed income structure. A full transaction still depends on the property, debt, buyer, documents, and final terms.
Rental Property Insurance FAQs
Why did my landlord insurance go up even though I had no claims?
Your claims history is only one factor. Premiums may also be affected by property characteristics, repair and replacement costs, severe-weather risk, regional losses, reinsurance costs, changes in coverage, and broader insurance market conditions.
Why did my mortgage payment go up when my interest rate did not change?
If taxes or insurance are paid through escrow, increases in either expense can raise your total monthly payment even when the principal and interest portion of a fixed-rate mortgage has not changed.
What does PITI mean?
PITI stands for principal, interest, taxes, and insurance. It is a useful way to look at the core monthly housing costs associated with a mortgaged rental property.
Can I shop around for cheaper landlord insurance?
Yes. The NAIC recommends shopping around when premiums increase. Compare equivalent coverage, deductibles, exclusions, insurer requirements, and financial protection rather than choosing a policy based only on the lowest premium.
Will increasing my insurance deductible lower my premium?
It may, depending on the insurer and policy. A higher deductible also means you take on more of the cost when a covered loss occurs. If the property has a mortgage, lender requirements may also affect the deductible you can choose.
Should I sell my rental property because insurance went up?
An insurance increase by itself does not determine whether a rental should be sold. Recalculate the property’s full cash flow, including rent, PITI, repairs, vacancy, management, and other expenses. Then compare whether keeping, selling, or exploring another structure fits your financial goals.
What is rental conversion?
Rental conversion is the process of selling a rental property through owner financing. The buyer becomes the property owner, while the seller receives payments according to the terms of a note instead of continuing to collect rent as the landlord.
How does higher insurance affect the Colonial Funding calculator?
Monthly PITI is one of the calculator inputs. Because the “I” in PITI is insurance, a higher insurance cost can increase the PITI amount you enter and change the estimated rental cash-flow comparison.
Current Insurance Research & Resources
U.S. Government Accountability Office:
Homeowners Insurance: Premiums Generally Tracked Inflation but Rose More in Disaster-Prone Areas
National Association of Insurance Commissioners:
Why Are My Insurance Premiums Increasing?
Federal Reserve Bank of Minneapolis:
Rising Property Insurance Costs Stress Multifamily Housing
Your Insurance Renewal Might Be Telling You Something Bigger
Maybe your rental property insurance increased and everything else about the investment still looks great.
If so, keep doing the math.
But if insurance is only the latest increase on top of property taxes, repairs, vacancy, maintenance, and the time you spend managing the property, do not judge the rental by the rent check alone.
Recalculate what you are actually keeping.
Then decide whether you still want to own the rental, sell it traditionally, or see what the property could look like through Colonial Funding’s Rental Conversion Program.
Same Property. Different Possibilities.
See What Your Rental Could Look Like
Run a quick estimate or talk with Colonial Funding about whether a rental conversion could make sense for your property.
