In recent years, the cost of insuring your home, car and other assets has risen sharply. But those rising costs could soon go even higher.
Experts say President Donald Trump’s recently announced tariffs on U.S. trading partners are likely to cause prices to rise on many goods and services, and that includes insurance.
Here are the types of insurance that may soon grow more costly, and how much you can expect prices to rise.
Car insurance
Auto repair shops in the United States get around 60% of all their replacement parts from Mexico, Canada and China, according to the American Property Casualty Insurance Association, a national trade organization. If the cost of these parts shoots higher, insurers will need to fork out more money on claims, and they would likely pass on those increased costs to policyholders.
The APCIA forecasts that the annual cost of personal auto insurance claims could jump by $31 billion to $61 billion over 12 months. Other insurer expenses could drive premiums even higher, the APCIA said:
“As the estimates are based on insurance data, given the number of uninsured motorists, or those that do not carry collision or comprehensive coverage for property damage to their own vehicle, the total impact on consumers is expected to be even higher.”
While there’s little if anything drivers can do about the effects that tariffs might have on their car insurance rates, you can always shop around to make sure you're getting the best price. Free online comparison tools make this a lot easier than it used to be.
Home insurance
Tariffs on imports of construction materials could trigger higher costs that would trickle down to insurance premiums.
Recently, insurance marketplace Insurify crunched the numbers and projected that tariffs would likely add about $106 to the average homeowner’s annual insurance premium. That would bring the national average to more than $3,600 by the end of 2025, Insurify says.
Home builders typically turn to Canada for lumber and Mexico for lime and gypsum products.
The good news is that home builders tend to rely on domestic materials more than the auto industry does. So, the price hikes for home insurance should not be as big as those for auto insurance.
Still, it’s smart to shop around periodically to make sure you’re getting the best deal on home insurance. Again, there are free online comparison tools that make this easier than it used to be.
Commercial insurance
It’s possible that tariffs could drive commercial insurance costs higher for businesses. Professional-services network PwC projects that tariffs would likely cause prices to rise for commercial lines of insurance:
“… inflationary impacts can vary widely across sectors based on the magnitude and scope (e.g., countries and exemptions) of new tariffs. For instance, if the cost of raw materials — ranging from oil and natural gas to timber and minerals — increases, public budgets may become increasingly strained, raising the risk of defaults. This is likely to pressure insurers that focus on the public sector.”
The law firm Bricker Graydon argues that if such risk increases for commercial insurers serving the public sector, they would have to increase their rates.
The APCIA also forecasts that tariffs would cause commercial auto insurance claim costs to be “impacted significantly,” with claim costs increasing by more than $45 billion.
Health insurance
Will tariffs increase the cost of your health insurance premiums? It’s difficult to say for sure.
However, a survey of health care industry professionals by Black Book Research, an independent research organization, found that 164 of 200 respondents polled believe that costs for hospitals and health systems will jump by at least 15% in the next half-year due to higher import costs.
As those higher costs move through the health care system, it is possible that health insurance companies will at some point pass on their own increased costs to policyholders.
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