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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

1 hour ago - World

U.S. and NATO answer Putin in writing while bracing for Ukraine invasion

NATO Secretary-General Jens Stoltenberg. Photo: Dursun Aydemir/Anadolu Agency via Getty

The U.S. and NATO provided Russia with written proposals on Wednesday to advance a "diplomatic path forward," even as they warned that Russia could invade Ukraine within days.

Why it matters: This is a delicate diplomatic balancing act. The U.S. and NATO want to show they're serious about diplomacy but unwilling to compromise on "core principles" — all without providing Vladimir Putin with an additional pretext for escalation.

The political leanings of the Supreme Court justices

Data: Martin-Quinn scores; Chart: Axios Visuals

The Supreme Court will continue to have a solid conservative majority even with Justice Stephen Breyer's retirement.

How to read the chart: An analysis by political scientists Andrew Martin and Kevin Quinn, known as the Martin-Quinn Score, places judges on an ideological spectrum. A lower score indicates a more liberal justice, whereas a higher score indicates a more conservative justice.

The front-runners for Biden's Supreme Court pick

Judge Kentaji Brown Jackson (left) and Justice Leondra Kruger (right) Tom Williams-Pool/Getty Images and Lonnie Tague, US Department of Justice

Two highly accomplished Black female judges — Ketanji Brown Jackson, a judge on the D.C. Circuit Court of Appeals; and Leondra Kruger, a justice on the California Supreme Court — are seen as the early front-runners to replace retiring Supreme Court Justice Stephen Breyer.

The big picture: Jackson is a powerful federal judge with a record that progressives feel they can trust. Kruger was a highly regarded litigator and has carved out a reputation for working well with conservative judges.