Homeowners in several U.S. states are facing higher insurance premiums due to concerns about extreme weather, and residents of Boulder, Colorado, are feeling the impact the most.
what’s happening?
As the Boulder Reporting Lab explained, wildfires are a year-round threat in Boulder County, and residents in mountain communities and other areas find it difficult to find home insurance due to the surrounding flammable terrain. I’m having a hard time.
For example, Gunbarrel resident Victor Lopez told Boulder Reporting Lab that his home insurance started at $1,000 a year in 2018 and has since increased to $2,500 a year. When he sought lower premiums from other insurance companies, he was charged even higher fees, including nearly $4,000 a year.
“We don’t know at what point we’re going to plateau,” Lopez said. “If prices continue to rise like this, I won’t be able to afford to buy a house anymore.”
This summer, the New York Times named Colorado as the fourth most expensive state for home insurance.
“Insurers don’t want to take that risk anymore,” Sara Wright, owner of Farmers Insurance Agency in Boulder, told the Boulder Reporting Lab.
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Why is this important?
“Climate-induced disasters are driving up homeowners’ insurance premiums in cities and towns across the country,” the Boulder Reporting Lab said.
In addition to Colorado, the Times named Florida, New York, Louisiana and Hawaii as states with the highest home insurance premiums.
The increasing frequency and intensity of extreme weather events due to rising global temperatures is making it difficult for insurance companies to keep up with repair and claim costs. Wright told the Boulder Reporting Lab that the high risk of fire in Boulder’s 80302 ZIP code is a major factor in the rise in insurance prices, which is why Farmers Insurance will reduce its insurance policies in Boulder and other mountain areas in 2025. He said he has decided not to update it.
“If you look at California, there are a lot of places where you can’t get insurance,” Boulder resident Don Darchinos told the Boulder Reporting Lab. “I don’t want to think that’s our future, but it could be.”
Companies like State Farm have stopped accepting new applicants in California, others have pulled out of high-risk areas altogether, and homeowners are no longer relying on expensive government-run policies. I have no choice but to do so.
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What is being done about this?
Janet Lewis, director of strategic communications for the Insurance Information Institute, told the Boulder Reporting Lab that homeowners who take the necessary steps to reduce the risk of wildfires around their property can enjoy lower insurance premiums. He said it is likely.
“There’s a lot of mitigation efforts being done by communities and individuals, and that’s going to be key going forward,” Lewis said.
However, insurance companies still consider Boulder homes too dangerous to insure. Last year, Colorado developed a Fair Access to Insurance Requirements Plan to provide insurance to homeowners and businesses struggling to secure coverage. The plan could begin offering coverage as early as 2025, but it is notable that the maximum amount would be $750,000, well below Boulder’s average home price of nearly $1 million. Ta.
Still, residents fear an uncertain future as rising costs could force them to leave their homes sooner than expected.
“Even apartments in Boulder are very expensive, and they’re going up and up every year,” Lopez said. “I’m so worried that if I sell my house, I’ll end up moving to a smaller place for about the same amount of money I’m paying now. That’s a nightmare for me.”
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