Will Home Insurance Rates Go Down in 2024? Here's What Actually Happened

Home insurance rates didn’t drop in 2024. If you were hoping for relief after years of steep increases, you’re not alone - but the numbers don’t lie. Across Australia, home insurance premiums rose an average of 8.7% in 2024, according to data from the Australian Securities and Investments Commission (ASIC). That’s higher than inflation, higher than wage growth, and higher than most people expected.

Why didn’t home insurance go down in 2024?

The short answer: risk is climbing faster than insurers can adjust. Climate change isn’t a future threat anymore - it’s a claims spreadsheet. In 2024, Australia saw its third-worst year on record for weather-related insurance claims. Floods in Queensland and New South Wales alone triggered over $1.8 billion in payouts. Bushfires in Victoria and South Australia added another $750 million. Insurers aren’t making these numbers up - they’re paying them out.

Reinsurance costs, which are what insurers pay to protect themselves from big losses, jumped 22% globally in 2024. That cost gets passed down. When reinsurers like Munich Re or Swiss Re raise their prices, Australian insurers have no choice but to raise yours. There’s no magic buffer. It’s simple math: more claims + higher reinsurance = higher premiums.

Construction costs also kept rising. Labor shortages, supply chain delays, and material inflation meant rebuilding a home after damage now costs 15% more than it did in 2022. Insurers base your sum insured on current rebuild costs - not what you paid for the house ten years ago. If your policy hasn’t been updated since 2021, you’re likely underinsured. And if you’re underinsured, your premium might still go up even if your house hasn’t changed.

What regions saw the biggest increases?

Not all areas were hit the same. Premiums jumped the most in coastal and flood-prone zones:

• Queensland coastal areas: +14.2% average increase - especially in the Sunshine Coast and Gold Coast
• Northern NSW: +13.8% - Byron Bay, Lismore, and Ballina saw the highest spike after the 2022 floods
• South East Queensland: +12.5% - Brisbane suburbs like Redlands and Logan were hit hard by both floods and storm damage
• Western Sydney: +10.9% - rising bushfire risk and extreme heat events pushed rates up

Meanwhile, regional towns with lower natural disaster exposure - like parts of regional Victoria or Tasmania - saw increases between 4% and 6%. That’s still up, but far less painful.

Did any insurers lower rates?

Not in the way you’d hope. No major Australian insurer reduced premiums across the board in 2024. But some offered targeted discounts:

• Allianz gave up to 10% off to customers who installed smart water leak detectors
• SGIO lowered rates by 5% for homes with upgraded roofs (Class 4 or higher, certified by a licensed builder)
• NRMA offered discounts for homes with fire sprinklers or bushfire-resistant landscaping

These aren’t blanket drops - they’re rewards for reducing risk. If you didn’t make any upgrades, you didn’t get the discount. And if you live in a high-risk zone, even a 10% discount might not offset a 15% base rate hike.

What can you actually do about rising premiums?

Waiting for rates to drop won’t work. The trend is up, and it’s not reversing anytime soon. But you can take control:

1. Review your sum insured every year - Use the 重建成本计算器 (rebuild cost calculator) on the Insurance Council of Australia’s website. Don’t rely on what your insurer says - they often underestimate.
2. Install risk-reducing features - A smart water shutoff valve costs $300 and can cut your premium by up to 8%. A bushfire-resistant roof can save you 5-12% depending on your area.
3. Bundle policies - Combining home and car insurance with the same provider can save 10-15%. But only do this if the combined price is still cheaper than shopping separately.
4. Shop around every year - Don’t auto-renew. Compare at least three quotes. In 2024, some customers saved over $400 just by switching insurers. One Sydney homeowner dropped from $2,100 to $1,650 by switching from a big-name insurer to a mutual provider.
5. Consider a higher excess - Raising your excess from $500 to $1,500 can cut your premium by 20-30%. Only do this if you can afford to pay more out of pocket if you claim.

What about government help?

There’s no federal subsidy for home insurance in Australia. Some states offer limited support:

• Queensland’s Flood Rebuild Assistance Program helps with rebuilding costs after a declared flood - but it doesn’t cover insurance premiums.
• NSW offers bushfire mitigation grants for homeowners in high-risk zones - you can get up to $5,000 for fire-resistant upgrades, which indirectly lowers your premium.

These programs help you rebuild after disaster - not prevent your premium from rising. They’re useful, but not a fix for the core problem.

Will rates go down in 2025?

Don’t count on it. Climate models show extreme weather events will keep increasing. Reinsurance prices are still climbing. Construction costs haven’t dropped. And insurers are still adjusting their risk models to reflect reality.

Some experts predict 2025 premiums will rise another 5-8%. If you’re in a high-risk area, expect 10% or more. The only way to avoid being priced out is to act now - not wait.

Bottom line

Home insurance rates didn’t go down in 2024. They went up - significantly. And unless the climate stabilizes (which it won’t anytime soon), they’re not going down in 2025 either. The only thing you can control is your response. Update your cover. Install protections. Shop around. Don’t assume your insurer has your best interests at heart. They’re businesses. Your job is to be smarter than the algorithm.