A new Senate report reveals that insurance companies are increasingly tightening their grip on homeowners in regions vulnerable to climate-related disasters, canceling policies and raising premiums in states like California, Florida, Louisiana, and Oklahoma. While Los Angeles County, currently facing devastating wildfires, does not appear among the most affected areas in the report, experts suggest data limitations may be masking the true extent of the insurance crisis in the region.
Following the devastating wildfires that have ravaged Los Angeles County, a new Senate report reveals a growing trend of insurance companies tightening their grip on homeowners in regions vulnerable to climate-related disasters. In the months leading up to the current infernos, insurance carriers across the nation began making significant changes to their policies, such as canceling existing policies and substantially increasing premium rates.
This trend has sparked concern among homeowners nationwide as they grapple with the escalating costs and availability of insurance in the face of increasingly frequent and severe climate events.The Senate report, compiled from responses from 23 major insurance carriers representing approximately 65% of the national homeowners insurance market, sheds light on the states and counties experiencing the most dramatic shifts in their insurance profiles between 2018 and 2023. Unsurprisingly, California, a state grappling with frequent wildfires and droughts, tops the list, with hurricane-prone regions in Florida and Louisiana also exhibiting significant changes. Oklahoma, which has seen a surge in wind and hail damage due to more powerful tornadoes, also features prominently, alongside parts of southern New England, the Carolinas, New Mexico, the northern Rockies, and Hawaii.While the report highlights the widespread impact of climate change on the insurance landscape, it also reveals an intriguing anomaly: Los Angeles County, currently besieged by wildfires, does not appear among the areas experiencing the most significant insurance distress. Erica Handloff, a lead staffer on the report, attributes this discrepancy to the relatively low response rate from insurance carriers. She suggests that the lack of complete data may be masking the true extent of insurance challenges faced by homeowners in the affected areas. Additionally, Handloff notes that the report may not fully capture the impact on condominium and cooperative policies, which could be disproportionately affected by the wildfires. Despite this limitation, the report offers valuable insights into the growing vulnerability of homeowners in climate-prone regions and the need for policy solutions to address the escalating risks
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