Illinois home insurance rates jumped by nearly 60% between 2019 and 2024, according to a study by LendingTree, an online loan lead generator and mortgage broker.
The increase made Illinois the seventh fastest-growing state in terms of prices, and was well above the national average of 40.4%, according to the study.
“Insurance companies have been raising their rates to keep up with their escalating expenses,” LendingTree home insurance expert Rob Bhatt said. “The early 2020s saw an uptick in natural disasters and inflation. Insurance companies have had to rebuild more homes than normal, and the cost of rebuilding each one has become more expensive.”
Increased occurrences of natural disasters spurred the local increase, said Kevin Martin, executive director of the Illinois Insurance Association, a nonprofit organization that represents the property and casualty insurance industry.
Inflationary pressures boosted the price of building materials such as lumber starting during the COVID-19 pandemic, which also contributed to the increase, he added.
Insurance companies are regulated by state officials, meaning the U.S. market is made up of 50 markets, each with different rules.
Insurance regulators in Illinois do not have the power to cap price hikes, although the law requires them to be informed of the changes. The state Senate is working on a bill that calls for empowering the Illinois Department of Insurance to approve changes.
In January, Allstate filed plans to raise homeowners’ insurance rates by 14.3% for Illinois customers. Rival State Farm filed for a 12.5% increase to homeowners’ insurance premiums in 2024.
Publicly traded Allstate noted a $451 million underwriting loss in its homeowners business in the first quarter of 2025, compared with a profit of $564 million in the comparable period of 2024. It recorded $3.3 billion of gross catastrophe losses during the quarter, which included the impact of the California wildfires.
“For right now, I think you can see by the rates that are filed by the companies here in Illinois, it is going to reflect these losses,” Martin said. “They are going to try and recoup through rates that are going to have to reflect dollar for dollar."
Northbrook-based Allstate’s stock is up 2.2% so far this year.
In April, the Consumer Federation of America said home insurance prices in Illinois rose 50% between 2021 and 2024, the second-fastest pace in the country during the past three years. The consumer research and advocacy group pegged average premiums for a house with a $350,000 replacement value at $2,942 a year for Illinois homeowners, making it the 20th most expensive state for insurance.
