Weekly Roundup: Rate Hikes Won’t Solve the National Insurance Crisis
FOR IMMEDIATE RELEASE
May 16, 2025
Contact: contact@insurancefairnessproject.com
Weekly Roundup: Rate Hikes Won’t Solve the National Insurance Crisis
Each week, the Insurance Fairness Project highlights the latest developments in the national climate-driven property insurance crisis.
This week, it’s more clear than ever that rate hikes alone can’t solve the national home insurance crisis.
New York Times: The Home Insurance Crisis Is Getting Even More Expensive
“Insurance is the climate crisis canary in the coal mine, and the canary is dying,” said Dave Jones, director of the Climate Risk Initiative at the University of California, Berkeley, Center for Law, Energy and the Environment. [...]
The insurance industry’s response to this swelling crisis has been twofold: raise rates and write fewer insurance policies. It has also pushed for less regulation.
But even in states like Florida, where insurance is lightly regulated, the market is breaking down.
U.S. Senate hearings:
This week, the U.S. Senate held two hearings on the national insurance crisis. First, a Homeland Security subcommittee called on Allstate and State Farm executives to testify about the companies’ claim practices following disasters. They also heard from insurance adjusters employed by the companies, as well as homeowners who shared their struggles. At the same time, Senate Democrats held a “spotlight hearing” on “Climate Risk, Crashing Markets: The Insurance Crisis Threatening the U.S. Economy.”
SPOTLIGHT ON ALLSTATE WHISTLEBLOWERS
Washington Post: Insurance adjusters say they were pressured to cut payouts after hurricanes
Adjusters were forced by Allstate — which hiked rates 34% last year in California — to doctor their reports to reduce payouts, they told a Senate panel this week.
“Frequently, these alterations and deletions are simply false,” Pilot property adjuster Clifford Millikan said. “There is no room for discussion. If an adjuster resists, the claim is reassigned to someone who complies.”
The Hill: Hawley questions insurance executives on political payments
WRAL News: Lawmakers warn of insurance crisis as NC families share struggles
State Farm’s California rate hike
This week, California Insurance Commissioner Ricardo Lara approved State Farm’s “emergency” rate increase – which will raise premiums by 17% for homeowners.
Our statement: “Californians can't afford and don't deserve rate hikes, period,” said Sophia Wilson, spokesperson for the Insurance Fairness Project. “The insurance crisis is climate change-driven, insurance companies have made it worse, and it can't be solved on the backs of homeowners and renters. Commissioner Lara and other policy makers should stand with families, not insurance companies, and find meaningful long-term solutions. We can’t just rate hike our way out of this.”
Adding insult to injury: The rate hike comes amidst complaints from L.A. wildfire victims, who say State Farm has slow-walked payouts and not covered smoke damage, among other concerns.
LA Times (Steve Lopez): Four months into insurance claim delays and disputes, a new blow to fire victims: A rate hike
Fire victims say disputes have involved, among other things, inspection and remediation of contaminants in homes and on properties, delayed coverage of temporary lodging expenses, and what many consider lowball payouts for losses. [...]
“We paid our premiums believing that when crisis came, we would be protected,” said yet another complaint. “Instead, we’ve been met with delay, deflection and denial — pushing families to the brink of financial ruin, housing instability and emotional collapse.”
Digital Ads: Extreme Weather Survivors is now running digital ads telling Lara to “Stand with families. Not the insurance companies,” saying he’s enabling State Farm’s pursuit of profits over payouts that homeowners are entitled to. (Politico | EWS ad)
Resources
Insurance Fairness Project and Data For Progress: Polling – Voters Want Their Government to Address the Property Insurance Crisis
78% of voters are concerned about rising property insurance prices, with 40% saying they are “very concerned”
Public Citizen and the Revolving Door Project: Mapping the Home Insurance Crisis
New interactive maps reveal the widespread nature of the U.S. home insurance crisis with seven metrics of availability and affordability.
Consumer Federation of America: Overburdened
The Dramatic Increase in Homeowners Insurance Premiums and its Impacts on American Homeowners
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The Insurance Fairness Project is an information hub dedicated to offering insights into the home insurance crisis, exploring its drivers and highlighting solutions alongside issue experts and community advocates.
