Kansas homeowners insurance costs rising | Derby News


While the rising cost of homes has certainly been felt by potential buyers in the past couple of years, that market trend has started to impact homeowners as well – especially in Kansas.

A recent report from QuoteWizard by LendingTree found that the average price of homeowners insurance has increased 2% nationwide from 2021 to 2022. That change has been even more drastic in Kansas, going up 16% – the fourth highest increase in the U.S. over the past year.


Locally, Wheat State Insurance Group owner Kennton Hoffman – an insurance broker – said he has seen that impact his clients across the board. Between the pandemic, lumber shortages and labor, he noted there are a number of factors driving the market up currently, but the rising home prices are definitely at the root of the issue.

“We’re starting to see a shift now of the home market. It went crazy in this area and that $350,000 house is not a $350,000 house anymore,” Hoffman said. “The market skyrocketed, so when the market skyrockets you’ve got to readjust what they call your replacement cost estimators. The carriers have had to adjust that to accommodate to insure because it now takes a half a million dollars to rebuild a $350,000 house rather than what it was two years ago.”

Hoffman said he believes some of the rising insurance costs are temporary because of the market, but if the market stays high so too will insurance rates. Per the QuoteWizard report, the average home price in Kansas increased 25% from 2020 to 2022.

With the housing market having been so much lower in Kansas than other states, Hoffman said that could be another factor as to why the insurance spike has hit so hard in the Sunflower State. He noted that same factors affecting homeowners insurance (labor/supply shortage) are also bleeding into other markets.

“It’s not just the homes either. Everybody’s getting hit every which way around right now,” Hoffman said. “Auto [insurance rates] are quickly on the rise as well because used cars are now, for the first time in our lives … your regular, run-of-the-mill used car has appreciated in the last 12 months where they never do.”

For homeowners, Hoffman said the rate spike started to set in at the start of 2022 after insurance carriers updated their rebuilding software at the end of 2021, with the contractor (used by most insurance companies) adding a standard 12% increase to reconstruction costs.

Using that adjustment (with a $100,000 home now costing $112,000 to rebuild, per the software), Hoffman said increased coverage costs also tend to lead to higher premium levels – meaning homeowners get “double whammied,” along with the natural price increases on a year-to-year basis.

Given the hike in insurance rates, Hoffman said it makes it that much more important for homeowners to be aware of their coverage and associated costs – to be ready in case that coverage is needed.

“Everyone needs to really review their coverages,” Hoffman said, “especially with the storms that we’re having, to make sure do they have a shortfall [and] are they insured.”

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