Insurance costs are taking a big bite out U.S. household budgets, with the total average cost for a family of four standing at just over $2,000 in 2025, according to
Given a tough labor market and rising household cost factors, that's a formidable figure for struggling heads of household. What's more, insurance providers need to step up and help consumers address the cost issue.
Michael Benoit, the founder of California Contractor Bond & Insurance Services, shared with me: "Insurers know exactly what is going on. They monitor loss ratios and cancellations of policies on a quarterly basis. For insurance consumers, the uncomfortable part is that most carriers don't care about whether your household can handle another rate hike because they are focused on making a profit margin."
Insurance companies have a mixed record of stepping in to address customer policy cost issues, but the more insurers take matters into their own hands with cost advice and policy management.
Here are three ways they're getting the job done.
1. Get in front of the cost problem before customers take drastic action
Benoit shared that some insurers are waking up and helping customers out. "The companies doing this right do send annual reviews without being asked," Benoit noted. "They catch life changes like paid-off vehicles, new drivers, home improvements and adjust coverage before clients waste money on protection they don't need anymore."
2. Be as transparent as possible.
Beyond rate discussions, insurers should also be proactive about transparency.
"Insurers can help customers identify coverage gaps before they become costly problems," Rees Odhiambo, a licensed insurance professional at ThriveXDNA, shared with me.
Insurers should create outreach messaging to address these gaps. "Plus, insurers should generate incentive programs for things like updated electrical systems or new roof installations, which can actually reduce claims while saving customers money long-term," Odhiambo noted.
John Espenschied, agency principal at Insurance Brokers Group, said insurers are starting to focus on issue-by-issue consumer insurance price challenges, with good results.
"One thing we see a lot now is safe driving programs," Espenschied shared. "Drivers who are willing to use an app or tracking device and show good driving habits can sometimes lower their auto premiums." Bundling policies still helps a lot too. "Putting home and auto with the same carrier often creates meaningful savings," Espenschied added.
There's also more focus on preventing claims. "Companies are giving discounts for security systems, water leak detectors, newer roofs, things that reduce the chance of a loss," Espenschied added. "Preventing claims is cheaper for everyone."
3. Get the message out
One challenge facing insurance companies is that many customers don't know programs or discounts exist unless someone walks them through it.
"A quick policy review often finds savings people didn't realize were available," Espenschied said.
Customers should take full advantage of the programs insurers have offered for years.
"For example, some insurers provide annual policy reviews where an agent goes through your policy line by line," Benoit said. "That's where we catch duplicate protections or coverage, you're paying for but don't actually need any more based on life changes."
Benoit also urges consumers to shop for policy quotes at every renewal cycle.
"Most people stay with the same carrier for five or six years and wonder why their premiums keep going up with the coverage level remaining flat," Benoit said. "In my experience, I've seen families paying $200 to $400 more a year because they didn't take 20 minutes to get competitive bids."
Carriers often rely on customer inertia, the tendency to stick with what they know. "That's precisely how they pad their profit margins without customers noticing," Benoit added.
