The Homebuilding Market’s Pivotal Challenge

In 2025, the U.S. homebuilding industry is navigating a market shaped by uncertainty. High mortgage rates, rising construction costs, volatile land pricing, and a hesitant pool of potential buyers are forcing homebuilders to rethink everything.

What was once a business defined by land accumulation and long-term holding strategies is shifting toward an "asset-light, land-light" model, where builders no longer carry extensive land portfolios. Instead, they take down lots as needed, limiting financial exposure while maintaining construction efficiency. The benefits are clear: lower risk, faster project cycles, and greater operational flexibility.

But there’s a downside: this model only works if the home sales process runs seamlessly, with no delays, no last-minute financing or insurance surprises, and no buyer uncertainty that slows transactions.

This is where insurance — and more importantly, the data that powers insurance availability, affordability, and risk assessment — becomes a central piece of the homebuilding puzzle.

In a conversation with Kimberlee Furcht, VP Executive Account Manager at Westwood Insurance Agency, we explored how homebuilders can integrate real-time insurance data into their operations, ensuring that homebuyers move from contract to closing with greater predictability and confidence.

Why Home Insurance Has Become a Bottleneck

For years, home insurance was a predictable, behind-the-scenes part of the homebuying process. Buyers secured coverage as part of their closing checklist, and while rates fluctuated, availability was rarely in question.

That’s no longer the case.

Escalating climate risks —wildfires, hurricanes, floods — have forced major insurers to pull out of entire markets. States like California, Florida, and Texas have seen dramatic reductions in home insurance options, leaving buyers scrambling for coverage at the last minute. Even where insurance is available, premium increases of 30% or more in some markets have added unexpected costs that derail affordability.

It's definitely becoming a challenge in certain markets,” Furcht says. “Having an experienced insurance agency that understands the business and the needs of a builder is essential. Instead of builders going to different insurance companies or agencies, we get to know the community and what those buyers need. We fight for product availability, knowing that new construction offers the best rates buyers will get."

For homebuilders operating on tight margins, any delay in closing, unexpected cost spike, or uncertainty that makes buyers hesitant to proceed threatens their business model.

Furcht sees this dynamic playing out firsthand:

We're hearing from our builders when they look at land, because they want us to assess the risk for insurance purposes. Are homebuyers going to be able to get insurance in certain areas? What might that look like from a price standpoint? We're getting involved much earlier in the process because of everything happening nationally—natural disasters, fires, storms—so having an insurance agency that can help through the process as the land is being evaluated is incredibly valuable."

The solution? Homebuilders can embed insurance into their workflow — before a homebuyer ever steps into a sales office.

The Power of Embedded Insurance

For a homebuilder, speed matters. A buyer who signs a contract today needs a predictable, friction-free path to closing. This is why the concept of embedded insurance — where home insurance options come built into the homebuying experience from day one — is gaining traction.

Westwood Insurance Agency has built a real-time data platform that provides instant insurance pre-approval, pricing transparency, and seamless integration into the homebuying process. Instead of waiting for a buyer to seek out insurance late in the game, homebuilders who partner with Westwood may be able to present buyers with an immediate, locked-in insurance rate as soon as they make an offer.

As Furcht explains:

Having an embedded insurance option helps builders know that when they’re ready to move forward, we can help them and their homebuyers. All underwriting is done upfront before potential homebuyers even enter the sales office. This is the transparency that builders and customers appreciate."

This integration offers two game-changing advantages:

1. Predictability for buyers – They know what their insurance costs may be, removing uncertainty from the financial equation.
2. Faster, more reliable closings for builders – With pre-underwritten policies in place, risk of last-minute disruptions or buyer hesitations due to insurance concerns is practically removed from the process.

In an asset-light business model, predictability isn’t just a luxury — it’s a non-negotiable.

Technology as the Backbone of Efficiency

Data-driven decision-making has become a non-negotiable factor for homebuilders, especially as they shift to more capital-efficient, just-in-time land acquisition strategies.

The traditional model — where builders owned vast land reserves and waited for demand to catch up — allowed for flexibility in timing. But today’s builders must carefully orchestrate land takedown schedules, home construction, and buyer closings in a synchronized rhythm.

A disruption in any part of that flow — whether from interest rate spikes, buyer hesitancy, or insurance delays — can cause financial instability.

Furcht describes how technology is helping builders remove that uncertainty and create a seamless, data-powered experience:

Homebuilders rely on capital efficiency and just-in-time land strategies, so it's critical that their land take-down schedules are coordinated with closing timelines. Having embedded insurance as part of that process helps manage their pipeline, ensuring that buyers have a solution in place and that everything is done in a timely manner."

Westwood has built API-driven solutions that integrate with homebuilder sales systems. These solutions pull data on new developments and pre-underwriting policies before homes even hit the market.

We're using APIs so that as soon as a community comes online, we can import that information into our system and get everything pre-underwritten. This allows us to provide quotes upfront, so the salesperson knows the insurance options as homebuyers tour the community. On the backend, we're also using bot technology to issue policies and improve efficiency."

The result? A frictionless sales process that eliminates one of the biggest emerging obstacles in new-home sales: insurance uncertainty.

The Road Ahead: What Comes Next for Builders?

As homebuilders navigate 2025’s high-stakes selling environment, success will depend on their ability to reduce risk—not just for themselves, but for their buyers.

For many buyers, affordability concerns are compounded by insurance challenges. Without clear, upfront knowledge about a home’s long-term insurance costs, many buyers hesitate or walk away entirely.

Builders who solve this problem—who integrate insurance into the front end of the buyer journey, who leverage data to remove risk, and who create predictable, trusted experiences—will win.

Furcht sums it up:

The best time for a homebuyer to secure insurance is during new construction — it’s when they'll get the best rate. We’re continuing to integrate bot technology and online purchasing options, so buyers can complete their application quickly, with minimal disruption to their homebuying process. They can do it all online, or talk to an agent if they prefer. It's about making the experience as seamless as possible for both builders and buyers."

As builders face the biggest test of their resilience and adaptability yet, one fact is clear: those who embrace real-time data, embedded insurance, and trust-based buyer experiences will define the next era of homebuilding. Those who don’t may find that in an asset-light world, the heaviest burden of all is uncertainty.