As the heating planet leads to shifts in the climate and increased occurrences of severe weather events, homeowners in vulnerable counties face the risk of being dropped from their insurance policies, according to the Daily Yonder. 

What’s happening?

Residents of places like the hurricane-prone North Carolina coast or rural areas of northern California, where wildfires are common, face uncertainty in their abilities to recover after a natural disaster, as homeowner’s insurance companies’ nonrenewal rates have been significantly rising since 2018. 

For example, nonrenewal rates in Dare County, North Carolina, where 24 hurricanes have struck since 1985, have increased from 2% in 2018 to a staggering 7% in 2023, according to Daily Yonder writer Sarah Melotte. 

This trend is in response to an increase in natural disasters in Dare County, and it continues in this way across the country. It is a disproportionate blow, as some areas are higher-risk for home damage. 

“For home insurance companies,” Melotte wrote, “insuring properties is a gamble, and it’s increasingly not worth the risk.”

Why is this increase in nonrenewal rates important?

Sometimes homeowners in vulnerable areas can keep their insurance, but often find themselves paying up to 82% more than others in lower-risk counties.

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Insurers, while attempting to avoid financial risk and not renewing with those more distressed by natural disasters, continue to invest billions of dollars into the dirty fuel industry, according to a study by Ceres, ERM, and Persefoni. Banks operate in the same way. 

Dirty fuels are the biggest contributors to planet-altering air and water pollution. 

This is financially and environmentally hazardous to all involved.

Nature cannot be controlled, only impacted. When people pollute the planet, the planet bites back, and the disproportionate impacts it has on vulnerable populations, beyond severe weather events, harm the everyday person as well as the economy. 

While residents of said high-risk areas struggle to keep their insurance policies, disasters in response to a changing climate do not stop.

Hurricanes, for example, are increasing in severity across the coastline of the United States, rating more frequently between Category 4 and Category 5. According to a Center for Climate and Energy Solutions report, their severity will continue to increase, resulting in surges in physical damages and deaths. 

What’s being done about financial devastation in the face of the changing climate?

According to a blog post on Financial Watch, policymakers must structurally reform the insurance sector, as well as national banks, to eliminate “moral hazards” and tackle their contribution to the changing climate. 

As the changing climate impacts both individuals and corporations financially, contributors to the climate crisis, which includes all people, must take action to offset its effects by saving energy, thrifting, recycling, and reducing the use of dirty fuels.

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