Apr 25, 2024 - News

Iowa and Midwest homeowners face insurance "wreck"

Illustration of an upward trending line chart on a welcome mat in front of a house door

Illustration: Sarah Grillo/Axios

Iowa and the Midwest are a "wreck" right now when it comes to home insurance, says Jeff Weddle, general manager of Guardian Mutual Insurance Association in Dallas Center.

Why it matters: Iowans are paying big costs to ensure their homes are insured or they're holding off from buying homes entirely, partly due to rising premiums.

How it started: The 2020 and 2021 derechos, as well as several major hail storms in Iowa, caused reinsurance companies to up their prices — resulting in a trickle down to insurance companies and subsequently, homeowners, Weddle says.

The big picture: Much of the increase in the cost of homeowners insurance is linked to climate change, including costly extreme weather events in the U.S. like wildfires in Colorado and hurricanes in Florida.

  • In 2023, 28 weather disasters caused at least $1 billion in damages.
  • That trumped a record, adjusted for inflation, going back to 1980, according to government data.

What they're saying: Recent headlines have reported home insurance nightmares for customers in Texas and California, but Iowa is "probably pretty close," Weddle says.

What you're saying: Several Axios Des Moines readers have struggled dealing with their home insurance recently.

  • Shane O'Malley of Waukee was denied a claim for hail damage on his roof, even though two separate roofers verified the damage. He ended up paying $25K out of pocket.
  • A company declined to insure one of reader Merle Walters' properties due to a tree branch, which was resolved when he had the limb removed.

What's next: Weddle is hopeful prices will decline if Iowa doesn't have major severe storms.

  • "We just need another year or two of average weather," he says.

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