In a nondescript office building in Littleton, insurance agents sit in cubicles, talking into headsets.

They are fielding calls from homeowners searching for coverage that won’t break the bank.

“It’s just completely unaffordable,” said Morgan Lloyd, an agent at the independent company Trailstone Insurance Group. “People are looking for better value.”

In November, Eric Shannon called for that exact reason. An email from his insurance company, Allstate, caught him off guard.

“It just said, ‘We’re looking forward to renewal. Click here to see what the details of your renewed insurance policy are,’” Shannon recalled.

He clicked. His premium was jumping from about $4,500 to $6,600 – a nearly 50% increase.

“This is ridiculous,” Shannon remembered thinking.

Stories like Shannon’s are becoming more common in Colorado. Lloyd said many companies are raising rates and pushing more costs onto consumers.

Colorado among the costliest states

The observation is backed up by a national report published last year, which analyzed more than 70 million mortgage payments and found inflation-adjusted insurance premiums had increased roughly 25% nationwide since 2020.

In Colorado, costs climbed even faster, with average premiums more than doubling between 2014 and 2024. The report puts the state among the top five most expensive for home insurance, alongside states like Florida and Louisiana.

Benjamin Keys, a professor at the University of Pennsylvania’s Wharton School and a coauthor of the report, said inflation is the biggest driver. Higher construction and labor costs make homes more expensive to build – and rebuild after disasters.

But in Colorado, weather also plays a major role. When insurers look at the state, Keys said, they see mounting climate risk – from wildfires and, increasingly, hail.

“ A surprisingly large and disproportionate share of those expected losses in a state like Colorado are, in fact, coming from hailstorms, which are becoming more frequent and more severe,” Keys said.

That finding is echoed by new data from the Colorado Division of Insurance, which revealed that hail risk is the biggest contributor to home insurance spikes. The data also suggests that insurance companies are spreading hail risk across the state. So, while costs have climbed most in forested, wildfire- prone mountain communities, they are creeping up almost everywhere.

Insurance is no longer a footnote

In Jefferson County, where Eric Shannon lives, new state data shows hail accounts for about half of the average annual premium. Wildfire risk contributes just 6%.

Shannon’s ranch-style house sits on the border of Golden and Lakewood. It backs up to open space.

“Pretty suburban, typical neighborhood that you’d find in the Denver Metro area,” he said.

Shannon and his wife had lived there for about a year when the renewal notice arrived. Now they have a new baby. Sitting on his living room couch, surrounded by bassinets and baby toys, and cozied up to his cat, Mayo, Shannon said he’s excited to raise his family in Colorado, where he grew up.

But the insurance hike comes in addition to other rising costs: mortgage payments, property taxes, and daycare.

“How are we going to adjust our other budgetary monthly spending to account for this?” he wondered.

More homeowners are asking similar questions, said Keys, the Wharton professor. But historically, people didn’t pay as close attention to home insurance.

“It’s almost been seen as sort of rounding error and people spend a lot more time focused on, say, the interest rate, on the mortgage,” Keys said.

That is changing. His research found insurance payments now make up a larger share of monthly homeownership costs, another factor threatening affordability.

Shopping around

After speaking with his insurance agent at the time, Shannon suspected an old claim on a previous property may have contributed to the premium increase. Still, he wasn’t willing to accept the 50% jump. He started shopping around and eventually found Lloyd, the Trailstone Insurance agent, on Reddit.

Shannon secured a cheaper policy through a smaller company, Auto Owners. Documenting the concrete Spanish-style roof tiles may have helped lower the cost, Lloyd said, because they’re more resilient to hail. Shannon also bundled his home and car insurance to keep the cost down.

“I mean, gosh, it was a relief,” Shannon said. “I don’t know anybody in my friend group and my family that isn’t dealing with predominantly home insurance premiums increasing dramatically.”

Carole Walker, executive director of the Rocky Mountain Insurance Information Association, said there are steps homeowners can take to reduce hail risk, like roof upgrades.

“Just putting on a hail resistant roof could qualify you for a discount with your individual insurance company, and put you at less risk for having a hail damaged roof,” she said. “

The upgrades can cost anywhere from a thousand to several thousand dollars. Data from the Division of Insurance suggests they could save homeowners a few hundred dollars per year.

Still, insurance companies are facing a higher number of claims, and more expensive ones. Walker expects this trend to continue. She said homeowners should prepare for insurance to keep taking a bigger bite out of the household budget.

This story was republished with permission as part of the COLAB, an independent, nonprofit journalism coalition. It is also the fourth story in a four-part series called “The Price of Paradise.” Read more about what Coloradans are struggling to afford at kunc.com.