home insurance
Newsletter
Credit: Greg Jones/Big Stock Photo
Climate risks may trigger the next housing crisis
Climate change is making U.S. homes riskier investments, as rising insurance costs signal a looming housing bubble that could devastate the economy.
In short:
- Home insurance premiums are climbing nationwide due to increasing climate risks like wildfires and floods.
- Experts warn that home prices don’t reflect these growing risks, leading to a potential housing bubble.
- If this bubble bursts, it could cause widespread economic damage, especially in vulnerable regions.
Key quote:
“We’re in a bubble, and whether it deflates slowly, causing some economic pain, or pops suddenly, shocking the country’s economic system, will come down to policy choices that governments make now.”
— Jesse Gourevitch, an environmental economist at the Environmental Defense Fund
Why this matters:
With climate-related disasters becoming more frequent, homeowners face increasing financial risks. Addressing these challenges now could prevent a catastrophic economic collapse in the future.
More: People are moving to risky areas despite climate dangers
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Newsletter
Credit: inc/Big Stock Photo
Rising insurance costs leave more homeowners uninsured
A growing number of homeowners are opting out of insurance as policies become more expensive and climate-related disasters increase.
In short:
- Many Americans, facing rising home insurance costs, are choosing to go without coverage.
- Insurers like State Farm are pulling out of high-risk areas, leaving homeowners with expensive alternatives.
- The rate of uninsured homeowners is rising, particularly among those who own their homes outright.
Key quote:
“It’s very unrealistic for any homeowner to think they can pay for catastrophic losses out of pocket.”
— Mark Friedlander, director of corporate communications, Insurance Information Institute
Why this matters:
As disasters become more frequent, the lack of insurance exacerbates the vulnerability of communities, making recovery slower and more challenging. It also emphasizes the need for robust climate action and adaptation measures to mitigate the risks and reduce the long-term costs associated with climate-related disasters.
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Newsletter
Photo by Kostiantyn Li on Unsplash
As climate shocks grow, lawmakers investigate insurers fleeing risky areas
Faced with growing losses from hurricanes, floods and wildfires, major insurance companies are pulling out of California, Florida and Louisiana — a shift that threatens to undermine the economies of those states.
Photo by Harmen Jelle van Mourik on Unsplash
More Americans find it difficult to afford home insurance as climate change disasters drive rate hikes
A growing number of Americans are finding it difficult to afford insurance on their homes, a problem only expected to worsen because insurers and lawmakers have underestimated the impact of climate change, a recent report said.
Photo by Jo-Anne McArthur on Unsplash
Government shutdown may hurt home sales in flood-prone areas
Congress funds a flood insurance program that many home buyers in risky areas rely on. The money is about to run out, a real estate trade group warned.
Newsletter
Photo by Tierra Mallorca on Unsplash
How climate change could cause a home insurance meltdown
It's increasingly expensive and difficult to get home insurance, as losses rise from climate-driven disasters such as wildfires and hurricanes. And the solutions aren't always politically popular.
Top Story
Photo by Scott Graham on Unsplash
Climate change is fueling an insurance crisis. There’s no easy fix
The climate crisis is fueling an insurance crisis, leaving homeowners struggling to find affordable coverage. Yet policymakers have few easy fixes at their fingertips.
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