Weekly Roundup: Climate-Driven Insurance Increases Are Draining Your Bank Account
FOR IMMEDIATE RELEASE
February 27, 2025
Contact: contact@insurancefairnessproject.com
Weekly Roundup: Climate-Driven Insurance Increases Are Draining Your Bank Account
Each week, the Insurance Fairness Project highlights the latest developments in the national climate-driven property insurance crisis. For more insurance updates, follow us on LinkedIn, X/Twitter, and Bluesky.
1/ CLIMATE CHANGE IS DRIVING UP INSURANCE COSTS: Climate change is already costing the average American up to $900 a year, say researchers, and insurance is a big driver of that, in both direct and indirect ways. As climate disasters become more frequent and costly, insurers charge more for less coverage. And as the industry resists paying out, litigation costs rise, too. (Who pays the price? Policyholders and taxpayers.)
New York Times: Is Climate Change Making Inflation Worse?
Capital & Main: As Climate Crisis Upended Homeowners Insurance, the Industry Resisted Regulation
Harvard Business School: Climate change is upending homeowners insurance nationwide
2/ WHAT STATES CAN DO: An Uninsurable Country, a new report from the Natural Resources Defense Council (NRDC), lays out steps state governments can take to tamp down the insurance crisis while there’s still time.
NRDC: An Uninsurable Country
States can and must play a growing role in:
Ensuring that building codes reduce the potential for damage from common natural hazards.
Incentivizing retrofits of existing high-risk homes to standards that go beyond the minimum building code requirements.
Funding climate resilience and risk-reduction efforts, including ensuring that insurance companies contribute to this much-needed work.
Preparing state-created insurers of last resort for the future, making them an integral part of the states’ risk reduction efforts and not just the final resting place of the riskiest properties.
3/ 58% OF HOMEOWNERS SAY OUR INSURANCE SYSTEM IS BROKEN: A recent Insurify survey reveals that a clear majority of homeowners don’t think the insurance system is working. And in the face of rising costs, 45% say carrying home insurance should be optional — which would mean dire financial risk for households that went without.
More than one-third (38%) support freezing insurance rates until costs stabilize.
One quarter (24%) support nationalizing home insurance by eliminating private insurers, including 22% of self-identified conservatives.
Nearly 1 in 3 homeowners say insurers are mostly to blame for high premiums.
4/ FLA. HOMEOWNERS WATCH THINGS GET WORSE AND WORSE: In Florida, the third most expensive state for home insurance, families are paying record premiums, facing stricter coverage limits, and often contending with delayed or underpaid claims, Meanwhile, insurance companies keep paying substantial executive bonuses and transferring large sums to their sister companies.
FOX 13 Tampa Bay: Florida’s Insurance Crisis
5/ COLORADO HELPS HOMEOWNERS GIRD FOR WILDFIRES: A new, free 28-point wildfire assessment program is helping Colorado homeowners understand how to make their homes more fire-resistant. When the bill Risk Model Use in Property Insurance Policies (HB 1182) goes into effect in July, those who participate may see their insurance rates drop.
“Last year was a pretty big year for Colorado regarding fire mitigation,” Dunn said. “We have the Colorado Wildfire Resiliency Code, along with House Bill 1182, both dealing with fire mitigation for homeowners.”
6/ CLIMATE AND INSURANCE BILLS MOVING: With devastating Los Angeles County wildfires barely a year in the past, California legislators have introduced bills to increase protections for homeowners and save them money.
The Admitted Insurers: Residential Property Insurance bill (SB 1076) would require insurers to offer coverage to homeowners who reduce their wildfire risk — and suspend the license of any company that didn’t.
The Residential Property Insurance: Nonrenewals bill (SB 1301) would mandate 180-day notice for cancellations, and require insurers to explain the reasons for cancellation and give homeowners a chance to remediate risky conditions first.
San Francisco Chronicle: Proposed California home insurance laws would guarantee coverage for fire-safe homes
And the Climate Disasters: Civil Actions bill (SB 982) would collect damages from fossil fuel companies whose pollution made climate change worse. Similar legislation is moving in Hawaii and New York.
Meanwhile, in Oklahoma, a bill establishing a “homeowner bill of rights” passed out of the House committee. It includes setting shorter deadlines for insurers to resolve claims and for the Insurance Department to resolve complaints.
7/ STATE FARM COMPLAINTS TRIGGER CALL FOR INVESTIGATION: State Sens. Ben Allen and Sasha Renée Pérez have called for a review of how the state insurance department processed complaints from L.A. wildfire victims about delayed and contested claims, after dozens of homeowners complained about delayed payouts from State Farm.
Los Angeles Times: Senators call for investigation into insurance department over handling of L.A. wildfire claims
“We want to see a responsive department. We want to see a department that is advocating for consumers,” Allen said.
Resources
Insurance Fairness Project: Polling – Voters Want Their Government to Address the Property Insurance Crisis
Public Citizen and the Revolving Door Project: Mapping the Home Insurance Crisis
Consumer Federation of America: Overburdened: The Dramatic Increase in Homeowners Insurance Premiums and its Impacts on American Homeowners
Brookings Institution: Homeowners insurance in an era of climate change
Consumer Federation of America and Climate and Community Institute: Penalized: The Hidden Cost of Credit Score in Homeowners Insurance Premiums
Americans for Financial Reform and Public Citizen: Rising Property Insurance Premiums: The Uneven Risks to Household and Systemic Financial Stability
Climate and Community Institute (CCI): Insurers of Last Resort: Why Today’s FAIR Plans Need a Redesign to Address the Home Insurance Crisis
Center for Climate Integrity: How Big Oil is Fueling the Insurance Crisis And Why State Policymakers Should Act
Yale Law Journal: The Uninsurable Future: The Climate Threat to Property Insurance, and How to Stop It
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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.
