Illustration: Aïda Amer/Axios

Climate change is making home insurance unavailable or unaffordable in the riskiest areas for hurricanes, wildfires and flooding.

Why it matters: As insurance companies pay record amounts to homeowners who have suffered partial or total losses, they retreat from or raise premiums in places where claims are owed.

What's going on: Company payouts for natural catastrophes in 2017 and 2018 stood at $219 billion, the highest ever for a consecutive two-year period, according to Swiss Re, a company — known as a reinsurer — that underwrites risks for home insurance and other policies.

  • Insurers continue to write policies in areas prone to disaster, but tend to hike monthly premiums to offset the cost.
  • Every state saw annual premiums rise between 2007 and 2016 (the latest year which data is available from the National Association of Insurance Commissioners).
  • States in tornado alley saw the biggest jump: Oklahoma saw a $654 increase over a decade, while Kansas saw premiums rise $501 on average.

Yes, but: The rise masks that insurers are limiting coverage in areas deemed too risky.

  • The 2018 Camp Fire in northern California was the most destructive in property damage the state's history.
  • Insured losses topped $13 billion last year, according to the California Department of Insurance.

Fearing bigger losses, insurers are pulling back from high-risk areas in California, leaving homeowners scrambling.

  • In the last three years, the counties at greatest risk for wildfires saw the number of new and renewed homeowners’ insurance policies fall by 8,700, according to the California Department of Insurance.

In Florida, homeowners have seen insurance costs rise as areas are considered more at-risk by insurers.

  • For residents by the beach or coast: Mortgage companies require flood insurance, a separate policy that's usually provided by the federal National Flood Insurance ~ typically $700.
  • Private companies, which once considered the risk too heavy, are dipping their toes back in —for a price.
  • The number of private companies offering flood insurance rose to 120 in 2018, (vs. 90 in 2017 and 50 in 2016, according to the Insurance Information Institute).
  • These players took in $541 million in premiums in 2018, an increase of 11.5% from the prior year.

Homeowners also need wind-related insurance, on top of regular homeowner's insurance, which are sometimes sold as a package.

  • "A huge portion of homeowner policy is wind- or hurricane-related in South Florida," Shahid Hamid, a professor at Florida International University, tells Axios.

The bottom line: Writing these policies could eventually put the insurers out of business.

  • Last year, California-based insurer Merced Property & Casualty filed for bankruptcy after it was unable to pay out millions of dollars in claims to policyholders after California's Camp Fire, per CNN.
  • "Regulators are becoming concerned about insurer solvency in the face of increasingly severe weather-related losses," according to a report by Deloitte.

Go deeper:

Go deeper

Dion Rabouin, author of Markets
19 mins ago - Economy & Business

Investors are betting the future is priced in euros

Illustration: Aïda Amer/Axios

It's the euro's time now — at least that's how investors have been positioning recently.

What's happening: Speculators have raised their bets to the highest in nine years that the dollar will fall and increased bullish bets that the euro will rise to the highest level on record, Reuters reported citing data from the CFTC.

Updated 1 hour ago - Politics & Policy

Coronavirus dashboard

Illustration: Annelise Capossela/Axios

  1. Global: Total confirmed cases as of 7 a.m. ET: 20,317,087 — Total deaths: 742,035— Total recoveries: 12,602,544Map.
  2. U.S.: Total confirmed cases as of 7 a.m. ET: 5,141,879 — Total deaths: 164,545 — Total recoveries: 1,714,960 — Total tests: 63,252,257Map.
  3. States: Georgia reports 137 coronavirus deaths, setting new daily record Florida reports another daily record for deaths.
  4. Health care: Trump administration buys 100 million doses of Moderna's coronavirus vaccine.
  5. Business: Moderna reveals it may not hold patent rights for vaccine.
  6. Sports: Big Ten and Pac 12 scrap fall footballMLB salaries at 37%
  7. World: Lebanon reported record new cases as UN warned blast may drive spike — Fauci "seriously" doubts Russia's coronavirus vaccine is safe
Mike Allen, author of AM
2 hours ago - Politics & Policy

3 keys to Joe Biden picking Kamala Harris

Photo: Jeff Kowalsky/AFP via Getty Images

Three quick points about Joe Biden's historic selection of Sen. Kamala (pronounced COMMA-luh) Harris of California as his running mate — and clues they give us to how Biden would govern:

  1. She was always at the top of his list. As I look back through my text threads with top Dems over the past five months, she was always assumed to be the most likely pick.