State Farm will soon hike insurance rates on Illinois homeowners by more than 27%.
That is effectively adding $746 to the average policyholder's annual premium. For comparison, the average homeowner's insurance costs are roughly $2,110 a year, or about $176 a month, according to a May analysis by NerdWallet.
Illinois Gov. JB Pritzker criticized the insurance giant's move, saying he is "deeply concerned by State Farm’s unfair and arbitrary insurance rate hike."
"These changes will cost Illinois homeowners hundreds of additional dollars per year without a state-based justification or corresponding increases in protection," he said in a statement.
The upcoming rate increase, which starts on Aug. 15, comes as the U.S. is contending with affordability issues in its housing market, making it difficult for people to purchase homes.
Millions across the country already lack home insurance coverage, putting them at risk in the event of a disaster. Specifically, 11.3 million U.S. owner-occupied homes are uninsured, according to the latest LendingTree study.