NPR: How climate change could cause a home insurance meltdown

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Big wildfires had started burning more often in California, creeping closer to Beth Pratt's home near Yosemite National Park. So Pratt did what homeowners in fire-prone areas are supposed to do: She added a metal roof, traded wood decking for laminate, installed a water tank and a fire hose, and cleared vegetation near her house. Pratt says she emptied her savings to make her "home for life" fire resistant.

But it didn't matter. Earlier this month, Pratt got a letter from Allstate, her home insurer of 31 years, saying her coverage was being dropped because of the threat from wildfires. "I get companies need to make money. I have no problem with that. Increase my rate," Pratt says. "But to just drop people — you know, it's scary. It leaves us feeling extremely vulnerable."

Pratt, like hundreds of thousands of other homeowners in California, now faces the state's growing climate threats with a weaker safety net. Over the past two years, several big insurers, including Allstate and State Farm, have scaled back their home insurance businesses in California to avoid paying billions for wildfire damage, or have halted sales of new policies altogether. Homeowners like Pratt are finding out that their longtime insurers have decided not to renew coverage.

California isn't alone. Insurance companies in states like Colorado, Louisiana and Florida are paring down business to shield themselves from ballooning losses as climate change fuels more-intense disasters. Earlier this month, the insurance arm of AAA announced it would not renew some "higher exposure" home insurance policies in Florida, and Farmers Insurance announced it will stop offering new home insurance policies in the state and won't renew thousands of existing ones, in part because of rising losses from hurricanes.

https://www.npr.org/2023/07/22/1186540332/how-climate-change-could-cause-a-home-insurance-meltdown