Jan 9, 2025 - Energy & Climate
Wildfires and hurricanes could make parts of U.S. uninsurable
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Americans who live in states dealing with fires, high winds and flooding could see insurance rates increase — or lose coverage entirely — as disasters intensify.
Why it matters: The affected areas span from coast to coast and include tens of millions of people living in two of the most populous states — California and Florida.
- Homeowner's insurance rates in some of these areas could start to become unaffordable as climate change fuels an increase in destructive storms.
- And if insurers decide to pull back altogether, states will need to step in to take on the risk — which can cost individuals more and offer less coverage.
Zoom out: The human toll, damage, and cost of disasters is mounting.
- The U.S. saw 28 weather and climate disasters costing at least 1 billion dollars in 2023 — the highest on record. Damages totaled $93 billion.
- 2024 disaster data is not yet out, though it’s expected to follow the trend.
What to watch: Insurers are changing how they factor climate and extreme weather risks into the premiums they charge for coverage, while some are suspending coverage, Axios’ Brianna Crane reports.
- That's pushing many homeowners to opt for public "insurer of last resort" plans — but often at higher rates.
