The cost of insuring your home may not go down anytime soon, as insurance companies are jacking up their premiums on homeowners to make up for losses from extreme weather.
An analysis from S&P Global found that rates have soared by 32.5% in Arkansas, 60% in Texas, and 42% in Oklahoma from 2018 to 2023.
Hurricane Beryl is the latest storm to wreak havoc on homes and properties, but it doesn’t take a degree in climatology to see that weather patterns are changing across the country. Chicago had 10 tornadoes touch down in a single day last week. Now, in response to the changing weather patterns, insurance companies are poised to increase their premiums.
At the same time, studies show that homeowners nationwide are struggling to keep their insurance, especially in areas where natural disasters are more common and frequent.
However, coverage costs are going up in general, as the analysis also reported that most insurers lifted their rates by double digits last year.
Progressive’s rates rose 10.4% in 2023, while the year prior only increased 2.9%. Similar results were seen with the insurer Allstate, jumping 10.2% in 2023, up from 4.3% in 2022.
On top of that, another analysis found that 1 in 3 policies for affordable housing providers experienced rate increases of at least 25% in their latest coverage renewal period.
With 2022’s Hurricane Ian, 2021’s tornadoes in western Kentucky, and even more extreme weather in 2023, the costs have been mounting for some time.
Hurricane Ian alone resulted in over $118 billion in damage, according to the National Oceanic and Atmospheric Administration.
But NOAA notes that while Ian was an extremely costly storm, 2023 saw 28 separate billion-dollar weather and climate disasters, setting a record that wasn’t held for very long, as 2020 saw 22.
With Beryl already being marked down as the earliest Category 5 hurricane in the Atlantic, forecasters are getting ready for what could be another dangerous and costly storm season.
A May study from the Federal Reserve reports that property damage from natural disasters “is one of the largest financial risks” for homeowners.
The study highlighted the wide-ranging impact, as 20% of US adults reported being financially impacted by a natural disaster or severe weather in the past 12 months.
Alice J. Roden started working for Trending Insurance News at the end of 2021. Alice grew up in Salt Lake City, UT. A writer with a vast insurance industry background Alice has help with several of the biggest insurance companies. Before joining Trending Insurance News, Alice briefly worked as a freelance journalist for several radio stations. She covers home, renters and other property insurance stories.