The Rising Cost & Difficulty Of Getting Homeowners Insurance

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Reasons behind surging homeowners insurance prices and difficulty in getting insured across the country:

  • Climate change: increases in frequency and severity of weather events.
  • Rising repair/rebuilding costs, surged 55% between 2019 and 2022.
  • The cost to insure new home customers in California is far higher than the price they would pay for policies due to wildfires, higher costs for repairing homes, and higher reinsurance premiums (up by 30% to 40%).
  • Hurricane risk is part of Florida and Louisiana’s problem.
  • Reinsurers have lost money for the last five years.
  • Homeowners insurance premiums are up by 1.6% in the last 12 months according to the Consumer Price Index.
  • Uninsurable places are growing across all 50 states.
  • In Louisiana, 17% of homeowners insurance policyholders had their policies canceled last year, according to an annual report from Louisiana State University.
  • State-backed insurance providers for homeowners who are not able to find policies elsewhere are growing.
  • In Florida, Citizens Property Insurance, the state insurance provider for 20 years, cites a rise in about 50% in the last year alone to 1.3 million policies.
  • Wildfires in California are down in 2023 by a half compared to the same period in 2022.
  • In 2020, more than 11,000 structures were destroyed by 8,648 wildfires.
  • In 2022 there were a total of about 7,500 wildfires and about 772 structures destroyed.
  • Rising temperatures could increase the risk of extreme wildfires in the coming years.
    • extreme wildfire events will increase up to 14% by 2030.
  • 43% of homeowners said their annual premiums increased in the last year.
  • About one in four homeowners have filed claims on their homeowners’ insurance with an average claim amount of $20,700.
  • Homeowners who had filed claims paid nearly $400 more per year than those who had never filed claims.
  • Around one in ten homeowners are planning to switch to a different insurance company in the near future.
  • 76% of people switching carriers are doing so for a lower rate.
  • 94% of American homeowners have homeowners insurance.
  • Southern homeowners have the nation’s highest average premiums at $1,834.
  • 43% of homeowners said their annual premiums increased in the last year.
Cause of Property Loss2020 PercentagesAverage Losses 2016-2020
Wind and hail45.5%$11,695
Fire and lightning23.8%$77,340
Water damage and freezing19.9%$11,650
All other property damage7.9%$6,673
  • About one in 20 insured homes has a claim each year.
  • About one in 35 insured homes has a property damage claim related to wind or hail each year.
  • About one in 60 insured homes has a property damage claim caused by water damage or freezing each year.
  • About one in 385 insured homes has a property damage claim related to fire and lightning.
  • About one in 525 insured homes has a property damage claim due to theft each year.
  • About one in 1,425 homeowners policies has a liability claim related to the cost of lawsuits for bodily injury or property damage that the policyholder or family members cause to others.
  • Only 49% of homeowners said they prepared an inventory of their possessions.

Unintentional Home Deaths And Injuries, 2021

Medically Necessitated Injuries35,900,000
Death rate per 100,000 population38.6

Professional Quote

“It’s not just California, Colorado and Florida that have been hit hard,” says Michael Orefice, Senior Vice President of Operations at SmartFinancial. “Many areas of the U.S. are experiencing paralyzing storms, and insurance rates are rising. Comparing rates can help people save money, but rates are higher than they were last year across the board.”

About SmartFinancial

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