For those in areas prone to natural disasters, the price for home insurance is growing rapidly, with places like California, Louisiana, and Florida seeing double digit increases each year, according to NPR. Florida in particular has been hit with increases of 40%, driving the price for home insurance up to three and a half times the national average, as insurers recognize the risks associated with hurricanes and flooding. With reinsurance companies increasingly turning to more sophisticated models of natural disasters, it’s not clear whether these increases will slow down. Says Benjamin Keys, professor of real estate at the University of Pennsylvania, to NPR, “What we have is a real changing landscape in insurance markets, a recognition that risks have increased in recent years. Disasters are occurring with more frequency and severity than previously forecast.”
With many insurance companies having either exited these states, or reduced the scope of policies offered, it’s also not clear when these home insurance rates will stabilize. Instead, notes Keys, it may require federal intervention. Says Keys, “Will we see a national wind insurance program? Will we see a national wildfire insurance program? I think that those are possibilities.”
Says Michael Yaworsky, insurance commissioner for Florida, “Everyone is in this together. It is a very difficult time for Florida homeowners.”
Source:
https://www.npr.org/2023/10/26/1208590263/florida-homeowners-insurance-soaring-expensive
