PORTLAND, Ore. (KOIN) – Oregonians are paying more to insure their homes in 2022, according to research conducted since the start of the year. 

Since 2021, homeowners insurance has gone up an average of 8% in Oregon, according to QuoteWizard — an insurance comparison platform. It’s one of the largest increases in the nation. 

In 2021, Oregonians paid an average premium of $1,023. In the first five months of 2022, that average premium has climbed to $1,105. 

Sarah Winder, a Farmers Insurance agent in Portland, could not give KOIN 6 News an exact percentage of the increase she’s seen in insurance premiums since 2021 but agreed it is around an 8% average. 

She said there are several things driving the cost up. The increased price of goods and services means homes cost more to rebuild if anything happens to them. Inflation is also playing a role and in Oregon, wildfires are affecting the market. 

In December 2020, catastrophe risk solutions company RMS estimated the insured losses caused by wildfires that year to be between $7 billion and $13 billion. In Oregon alone, it estimated the insured losses totaled between $1 billion and $3 billion. 

“This [2020] wildfire season reaffirms the growing catastrophic nature of this peril. Wildfire risk is clearly evolving, not only in California, but also in other states, as we observed in Oregon and Colorado,” Rajkiran Vojjala, vice president of model development said in the report. 

Winder, from Farmers Insurance, said wildfire damage not only impacts the price of homeowners insurance in rural parts of the state but also in urban parts. She said the threat impacts everyone. 

The Insurance Information Institute said in 2021, damage from tornadoes, hurricanes, severe storms, wildfires, floods and other natural disasters reached $92 billion in the U.S. The institute said the average insured natural catastrophe losses have risen nearly 700% since the 1980s. 

III also attributes supply-chain issues and labor shortages to driving up the cost of home repairs and replacement, in turn, driving up the price of homeowners insurance. They said longer-term trends affect rates. 

Inflation also affects premiums because the price of lumber and home construction labor is especially relevant to home repair and rebuilding costs, III said. 

The institute’s trends and insights report from February 2022 emphasized how unprofitable homeowners’ coverage has been for insurers in recent years. Between 2017-2021, four out of the five years were not profitable. 

“Long-term maintenance of an unprofitable product line is not a sustainable business model. Without substantial rate increases, insurers might have to dip into their policyholder surplus — the funds regulators require them to maintain to keep their promises to pay future claims. If policyholder surplus approaches defined regulatory thresholds, insurers will be required to raise rates or, potentially, go out of business,” the report states. 

Nationwide, QuoteWizard said average homeowners insurance premiums are up 2%. In Washington, premium rates increased an average of $4 since 2021, but in Idaho, rates are up 34% – the highest jump among U.S. states 

QuoteWizard analysts believe the rising cost of home prices and building materials could create a situation where many people’s policies may no longer cover their home. 

For people concerned about keeping up with the rising cost of their premiums, Allstate insurance recommends bundling home and auto, or equipping their home with theft or fire protection devices to lower their rates. Setting up automatic payments is another way to lower the bill. 

Other insurance agents recommend shopping around. 

Sevag Sarkissian, a public affairs representative for State Farm in Oregon and Washington, said State Farm’s most recent rate change for its homeowners insurance customers in Oregon was 3.5% and it went into effect on Dec. 1, 2021, for new customers and on Feb. 1, 2022, for renewing customers. 

“Every customer is unique and has specific insurance needs. The cost/premium for a homeowners insurance policy is influenced by many factors including the location of the property relative to natural hazards, condition of the property, a customer’s past claim activity and the coverage types and amounts chosen by the customer,” Sarkissian wrote in an email to KOIN 6 News. 

Winder, from Farmers Insurance, said customers should be aware that more increases could be coming. She said insurance agents are seeing the price of goods, such as lumber, stabilizing, but they’ll be keeping an eye on it. 

She said insurance agents receive updates on the cost of homebuilding materials every few months and use a program to estimate the cost of home reconstruction to help set their rates.