Few challenges are disrupting real estate transactions more unpredictably than the recent surge in insurance premiums. From first-time buyers to seasoned investors, clients across the country are seeing higher-than-expected costs that can delay deals, derail financing, or cause buyers to walk away. For real estate professionals, understanding why premiums are climbing and how to guide clients through these challenges is due diligence and a critical service.Why insurance premiums are on the riseWildfires, hurricanes, floods, and other extreme weather events are becoming more frequent and destructive. Insurers are recalibrating risk models, leading to higher premiums in areas previously considered low-risk. In California, Florida, Texas, and other high-exposure markets, annual premiums have doubled or even tripled for many homeowners.Material and labor shortages have driven up the cost of rebuilding homes. Insurers must account for higher replacement costs, leading to steeper premiums across the board; even in regions not prone to natural disasters.Several insurance carriers have pulled out of high-risk regions entirely or significantly reduced their exposure. This limits consumer choice and puts upward pressure on premiums from the remaining carriers, who take on more risk and pass along the cost.Reinsurance, the insurance purchased by insurers, has also become more expensive and harder to obtain. That cost trickles down to consumers, particularly in states with heightened exposure to catastrophic losses.How insurance issues disrupt real estate transactionsClients facing unexpectedly high insurance quotes may not qualify for financing. Lenders often factor insurance into debt-to-income ratios. A spike in premiums can suddenly disqualify a previously approved borrower.Higher insurance requirements may push total monthly housing costs beyond what an appraiser deems reasonable. That can lead to lender denials, buyers renegotiating their offers, or abandoning the purchase altogether.Premium increases affect buyer psychology and budget. Even in desirable markets, properties in flood zones or fire-prone areas may receive fewer offers, longer days on market, or require significant pricing concessions.When buyers feel blindsided by insurance surprises late in the transaction process, trust can erode, both in the deal and in the professionals advising them.What agents can do to support their clientsProactively address insurance costs in early conversations, especially in markets known for elevated premiums. Recommend that clients speak with a trusted insurance agent early in their home search, not after they go under contract.Just as you recommend lenders and inspectors, add experienced insurance professionals to your referral list. Seek out brokers with strong access to multiple carriers who understand your local market’s risks.Fire-resistant materials, new roofs, updated electrical systems, and mitigated landscaping can all reduce premiums. In listing descriptions and showings, highlight these features and their financial implications.Use comps and historical context to help clients understand what’s typical for a given area. While you’re not an insurance agent, being informed on general trends will help your clients make faster, smarter choices.If rising premiums reduce the buyer pool or impact pricing, your ability to strategically market a property becomes even more important. This is where agents powered by Luxury Presence stand out: Our data-driven marketing tools, elegant web design, and SEO-backed lead generation help properties shine even in slower markets.Why this matters right now