This brief examines how rising property insurance costs and changing insurance market conditions are affecting Latino homeownership. Drawing on national and metropolitan area–level data, we identify six key findings related to insurance affordability, market access, financial vulnerability, and postdisaster resilience.
Why It Matters
Property insurance is becoming an increasingly important driver of housing affordability and sustainable homeownership. As climate risks reshape insurance markets, rising premiums, growing deductibles, and reduced insurance availability are creating new financial pressures across multiple stages of the homeownership life cycle. These challenges disproportionately affect Latino homeowners and have important implications for long-term housing stability and wealth building and closing persistent homeownership gaps.
Key Findings
Latino homeowners are most likely to be uninsured
Nearly one in five Latino homeowners (18.2 percent) lacked homeowner’s insurance in 2024, compared with 12.9 percent of homeowners overall. Latino homeowners have consistently experienced substantially higher uninsurance rates since 2019, highlighting growing challenges in obtaining and maintaining insurance coverage.
Insurance affordability pressures are increasingly concentrated in high-risk housing markets
Insurance affordability challenges are not evenly distributed across the country. Latino homeowners in high-risk metropolitan areas—including Houston, Chicago, Dallas, Phoenix, and San Antonio—are substantially more likely to face severe insurance cost burdens, underscoring the growing geographic concentration of affordability challenges.
Low-income Latino homeowners pay disproportionately high insurance costs
Even within the same high-risk neighborhoods, low-income Latino homeowners pay substantially higher effective insurance rates than middle- and high-income homeowners. The largest gaps are found in Chicago, Dallas, Houston, Miami, and San Antonio. This suggests that disaster risk alone does not fully explain insurance affordability challenges and that other factors may influence what homeowners ultimately pay for coverage.
Lower credit scores may create a double affordability burden for Latino homeowners
Across every metropolitan area we examined, Latino homeowners with credit scores below 660 paid higher effective insurance rates than those with higher credit scores in similar high-risk neighborhoods. The largest disparities occurred in Miami, Chicago, Houston, New York, Phoenix, and Dallas, where lower-credit borrowers consistently paid more relative to their home values.
Rising deductibles are increasing Latino homeowners’ financial exposure
Deductible-to-coverage ratios have increased for Latino homeowners across all risk categories, leaving households responsible for a larger share of disaster losses before insurance coverage begins. Latino homeowners consistently faced higher deductible burdens than homeowners overall, increasing their financial vulnerability after disasters.
Reliance on FAIR plans is rising rapidly
Latino homeowners are increasingly turning to Fair Access to Insurance Requirements (FAIR) plans as private insurance becomes more difficult to obtain. Among Latino homeowners living in high-risk areas, FAIR plan participation quadrupled from 4 percent in 2018 to 16 percent in 2024, compared with an increase from 2 percent to 11 percent among homeowners overall.
Policy Implications
Improve insurance affordability and market access: Strengthen insurance market oversight, support a stable reinsurance market, and explore public-private partnerships to help reduce premium volatility, preserve affordable coverage, and ensure FAIR plans and private insurers can continue serving high-risk communities.
Reduce financial barriers to homeownership: Evaluate whether credit-based insurance pricing and rising deductibles create unnecessary affordability barriers, while helping homeowners better understand and prepare for out-of-pocket disaster costs.
Increase transparency in insurance markets: Expand transparency around insurance underwriting and pricing models, and improve public access to standardized insurance data to better monitor affordability, market trends, and potential disparities.
Invest in resilience and disaster recovery: Expand investments in home hardening, climate resilience, and disaster recovery—including strengthening HUD's Community Development Block Grant–Disaster Recovery program—to help communities recover more quickly after disasters.
How We Did It
This analysis integrates ICE Mortgage Data and Analytics with 2018–24 Home Mortgage Disclosure Act data, the Federal Emergency Management Agency National Risk Index, and the 2024 American Community Survey to provide a comprehensive assessment of property insurance affordability, market access, and financial vulnerability among Latino homeowners and homeowners overall at the national and metropolitan area levels.
