Why Indiana homeowners insurance may pay less for roof fixes

Thunderstorms, hail and tornadoes are part of summertime in Indiana. They're also one of the big reasons why homeowners have seen jumps in their insurance bills.

Insurance premiums rose about 16% for a typical Indiana homeowner between 2021 and 2024, according to an analysis of commercial data from the Consumer Federation of America. Insurance companies are also offering reduced coverage for roof damage — leaving homeowners with steep repair costs when disaster strikes.

When insurance premiums rise, that increases the cost of housing for new buyers and for current homeowners. In an informal FPI News survey about affordability in Indiana, several respondents said rising insurance bills were burdensome for their families.

Here are some of the reasons why bills are up in Indiana, how insurance coverage is changing and what consumers can do to protect their homes.

Convective storms a major issue

When you think of natural disasters that destroy homes, hurricanes and wildfires come to mind. Those disasters can be enormously costly. But a year's worth of smaller wind and hail storms can add up to more damage.

Severe convective storms — a term that includes hail, severe thunderstorms and tornadoes — were the costliest disasters for insurers globally in 2025, according to a new study from the climate risk modeling firm First Street. The Midwest is particularly vulnerable to hail, which can cause expensive damage to roofs.

More storms are happening

Nearly two-thirds of the country's most costly weather disasters were severe storms — tornadoes, high wind and hailstorms — in 2024, according to data from the NOAA National Centers for Environmental Information.

Storms are happening more frequently, and as development spreads into areas that used to be rural and sparsely populated, they cause more damage.

The number of storms that cause more than $1 billion in damage has dramatically increased, according to federal data. In 2024, 17 storms met that threshold, up from just two in 2004.

Inflation is real

The insurance industry points to rising construction costs as one of the primary reasons premiums are up across the country. When insurers have to pay out more to homes, those costs ultimately drive up premiums.

Replacement costs for property and casualty-related losses increased by an average of 45% between 2020 and 2023, according to a report from the U.S. Treasury Department.

Insurers are covering less

As the cost of repairing and replacing roofs adds up, insurance companies are trying to shift the burden to homeowners. Some policies have separate, higher deductibles for roof damage. And insurance might also cover far less than it costs to replace your roof.

There are two kinds of insurance coverage: replacement cost value pays what it takes to repair your home. Actual cash value pays what something is considered to be worth now — less than it would cost to repair.

The Federal Housing Finance Agency announced in March that it would loosen rules that previously required many homeowners to purchase replacement cost value coverage for their roofs. Under the new rules, more people will be able to get plans that offer actual cash value roof coverage.

That can lower your premium. But if hail or storms damage your roof, you may be forced to pay a large part of the replacement costs yourself.

Marital status, credit ratings

Homeowners insurance rates are driven by the amount of coverage you need and details like the location and condition of your home.

What might surprise you is that insurers may also look at personal factors, like whether you are married, what you do for a living and your credit history. A typical Indiana homeowner with a medium credit score can expect to pay about 50% more than a neighbor with a high credit score, according to a report from the Consumer Federation of America and the Climate and Community Institute.

Shop around — but be cautious

Consumer and industry advocates say one of the best ways homeowners can save on their insurance is to shop around and compare the cost of similar coverage from different companies.

But consumers need to be sure the policy provides enough coverage.