Due to climate change, natural disasters such as hurricanes are becoming more destructive. Homeowners around the world are feeling the effects as home insurance premiums soar. Here are the top 13 states where home insurance premiums are expected to increase the most in 2024.
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Homeowners across the country are facing an increasingly severe insurance crisis in the wake of Hurricanes Milton and Helen.
These two hurricanes are just the latest in a growing list of natural disasters wreaking havoc across the United States. Last year, 28 extreme weather events caused a total of $92.9 billion in damage across the United States.
Combined losses from Hurricanes Miron and Helen could be $55 billion, according to insurance risk management analysis provider Moody’s RMS.
This high price will have a dramatic impact on homeowners. That’s actually already happening, with homeowners seeing a 20% increase in the cost of home insurance from 2021 to 2023, according to insurance company Insurify, and Insurify predicting prices will drop even more in 2024. I expect it to rise.
We look at studied weather patterns, historical premiums, local laws, state building codes, and insurance company activities to determine which states have the greatest impact on home insurance from natural disasters. As the scale of natural disasters increases and property damage increases, insurance companies may go bankrupt, terminate existing insurance policies, or deny coverage outright in certain states. This leads to less competition in the insurance market and ultimately leads to higher premiums for homeowners.
Climate change is putting these 13 states in an ‘insurance crisis’
According to the Insurify report, Florida, California, and Louisiana have been particularly hard hit by climate disasters in recent years, resulting in multiple insurance companies declaring bankruptcy or canceling policies. They are reportedly discontinuing or withdrawing from the state.
As hurricane damage intensifies, insurance prices in neighboring states such as Alabama have increased dramatically.
Even so-called “climate havens” (typically Midwestern states isolated from severe hurricanes and wildfires) are not safe from the climate or insurance crises. Thunderstorms, hailstorms, tornadoes, and floods all cause property damage and drive up insurance costs. In fact, Insurify predicts the Midwest will see the biggest increases in insurance costs as insurers scramble to change their pricing strategies.
Fortunately for homeowners in the Northeast, the effects of the severe weather have not been as severe, home insurance companies continue to make profits, and the risk of insurance price increases has been reduced. But that doesn’t mean the Northeast is safe from future insurance crises, the report says, with flooding risks becoming more severe, especially in Vermont.
Reducing carbon emissions and slowing climate change is critical, but results can take years to see. For many homeowners, the rise in extreme weather events and the associated higher costs of home insurance are an immediate and unavoidable reality.
“Even with mitigation measures in place, U.S. homeowners, especially in states at risk, will see higher premiums due to weather-related losses and, in the short term, insurance companies will retreat from high-risk areas.” “should be expected,” the report said.
Here are the 13 states facing the climate change insurance crisis and their projected home insurance rate increases in 2024, according to Insurify.
