As the intensity and frequency of natural disasters continues to increase, homeowners across the country may also continue to experience increases in their home insurance premiums.
Insurance companies are expected to be hit hard after Hurricane Helen caused damage across the southern United States. Ryan Serhant, a real estate agent who stars on Netflix’s “Owning Manhattan,” told Fox Business that the hit on insurance companies will lead to higher premiums.
“I think this is one of the biggest insurance crises we’ll have in a very long time,” Serhant said.
The situation is even worse, he said, noting that most homeowners in Florida and the Carolinas don’t have flood insurance.
“What’s even scarier to me is that only 2 to 4 percent of homeowners actually have flood insurance. That’s about $34 billion in negative impact,” Serhant said.
This struggle is highlighted in Bankrate’s 2024 Extreme Weather Survey, which found that one in four U.S. homeowners are unprepared for the potential costs associated with extreme weather in their area. states.
The study, conducted earlier this year, notes that storms like Hurricane Beryl “already cost U.S. homeowners and their insurance companies billions of dollars.”
Insurify, an online insurance marketplace, said in a report that home insurance premiums in Florida could rise by 7% this year alone.
The average homeowner in Florida currently pays $10,996 a year in insurance premiums, according to the most recent data for 2023.
Louisiana has the second-highest home insurance premiums in the nation, with homeowners paying $6,300, three times the national average. Insurify expects costs in the state to rise another 23% in 2024.
Serhant’s warning that this hurricane will be a disaster for home insurers comes as more than a dozen home insurers have filed for bankruptcy since 2019.
Other home insurance companies have also decided to pull out of states where catastrophic natural disasters are more likely to occur.
As storms become more common, Bankrate warns that “we could see the cost of severe weather before the weather changes.”
