Illinois Homeowners Face Another Insurance Shock as Allstate Follows State Farm’s Lead
If you’re a homeowner in Illinois, there’s more tough news coming your way, and it’s hitting right where it hurts — your monthly bills. Allstate has announced that it will raise homeowners insurance rates across the state, following closely behind a much larger increase already rolled out by State Farm earlier this year. For many families, this latest hike is expected to add new pressure at a time when housing costs are already stretched thin.
According to filings with the Illinois Department of Insurance, Allstate plans to increase homeowners insurance rates by an average of just over 8 percent, with the changes taking effect on February 24, 2026. That means more than 200,000 policyholders will soon see higher premiums when their policies renew. While the increase will vary depending on the homeowner and location, most customers can expect something close to an 8.8 percent jump, with some seeing increases as high as 10 percent.
Allstate has pointed the finger squarely at severe weather and rising repair costs. It has been said that storms, floods, and other extreme weather events are becoming more frequent and more expensive to deal with. On top of that, higher prices for labor and building materials are reportedly driving up the cost of rebuilding and repairs after damage occurs. From the company’s perspective, these pressures are being passed along to consumers.
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This move comes only months after State Farm, the nation’s largest home insurer, implemented a massive 27 percent rate increase for Illinois homeowners. That earlier decision sparked public outrage and prompted legal action from Illinois Attorney General Kwame Raoul, who filed a lawsuit demanding that State Farm turn over detailed insurance data. Concerns were raised about transparency and whether companies are taking advantage of Illinois’ loose insurance regulations.
What makes Illinois stand out is the fact that it has very limited oversight when it comes to insurance pricing. Insurers are required to notify regulators about rate changes, but the state lacks the authority to reject increases it considers excessive or unfair. In fact, Illinois is the only state in the country without laws explicitly prohibiting excessive, inadequate, or discriminatory insurance premiums for homeowners.
Consumer advocates argue that these increases are especially harmful because homeowners insurance is often required by mortgage lenders. When premiums rise, monthly mortgage payments go up as well, putting people who are already struggling at greater financial risk. Critics also point out that Allstate reported billions of dollars in profit this year, raising questions about whether such steep increases are truly necessary.
Lawmakers have tried to respond. A bill that would have given the state more power to regulate homeowners insurance rates passed the Illinois Senate but failed in the House earlier this year. Still, with rate hikes continuing and public frustration growing, the issue is expected to return to the spotlight in the months ahead.
For now, Illinois homeowners are left bracing for higher costs, caught between extreme weather, rising expenses, and an insurance system with very few guardrails.
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