Rising insurance premiums, climate risk and inflation are reshaping the dynamics of the US homeowners' insurance market, according to Nationwide's 2025 Homeowners Report. The findings point to growing policyholder uncertainty, with agents increasingly positioned as risk advisers rather than traditional intermediaries.
Nationwide said homeownership is being tested by converging economic and environmental pressures, with 63% of surveyed homeowners expressing confidence in their current coverage but more than half admitting uncertainty over what is actually protected. Agents identified the top client concerns as higher premiums, weather-related damage and unexpected repair costs.
Shift in customer expectations
The insurer said the findings highlight a shift in customer expectations, from claims support to proactive risk management. More than 85% of agents now recommend smart-home technology as a preventive tool, with the most common devices being smoke and carbon monoxide sensors, smart locks and water flow monitors.
Michael Tripp, senior vice president of personal lines sales and distribution, said Nationwide views prevention as integral to protection, with agents expected to translate data and technology into actionable guidance.
The report found homeowners are responding, with adoption of smart-home systems now at 48%, climbing to 71% among Gen Z and Millennials. These younger policyholders are more likely to install safety technology to qualify for premium discounts.
The study also revealed a marked rise in policy reassessments as affordability concerns persist. Nearly half of all homeowners, and 57% of Gen Z and Millennials, spoke with an agent in the past year to review their coverage. Seventy-eight per cent (78%) of agents said clients are seeking ways to reduce premiums, while others are increasing coverage to reflect higher rebuild and repair costs.
A shift in function
Nationwide said these behavioral shifts are altering the function of insurance distribution, with agents taking a more consultative approach that helps clients balance cost control with adequate protection. Tripp said that strengthening client relationships through regular reviews and preventive support is now central to sustaining long-term retention and profitability.
The report signals that as risks intensify and margins tighten, insurers will increasingly rely on advisory-led distribution and risk prevention initiatives to manage exposure, differentiate offerings and sustain customer trust in a challenging property market.
