CelloMom On Cars
New rule in #California "will require home insurers to offer coverage in high-risk areas.
In exchange for increasing coverage, the state will let insurance companies pass on the costs of reinsurance to California consumers.
The ultimate goal of the new rules is to get homeowners out of the California Fair Access to Insurance Requirements (FAIR) Plan, which often serves as the last resort."
CelloMom On Cars
This piece is mostly about oversupply built up in the early years of the covid pandemic. And only this one, oblique, reference to the effects of climate change (without naming it):
"Surging HOA [homeowners association] fees, high insurance costs and destructive natural disasters are also making many #Florida house hunters hesitant to pull the trigger."
https://www.newsweek.com/florida-faces-pileup-unsold-homes-2007452
CelloMom On Cars
"It's clear that the worsening wildfire seasons have been a major driving force behind #California's market instability. Specifically, the 2017 and 2018 seasons were "particularly devastating, raising concerns about the insurability of catastrophic wildfire risk,"
The massive losses incurred from those fires "wiped out more than a quarter century of cumulative profits for the industry twice over."
https://www.npr.org/2025/01/14/nx-s1-5251632/california-fires-home-insurance-climate-change
#HomeInsurance
CelloMom On Cars
""There's lots of people being told that we won't cover you for flood, if you want flood cover it's going to be $20,000.
"Now in my view that is not a serious offer, that is code for 'you're #uninsurable'."
Analysts expect banks will start turning down #mortgages in high-risk areas."
https://www.abc.net.au/news/2025-01-15/insurance-premiums-rising-uninsurable-homes-climate-change/104814932
#HomeInsurance
jcriecke
@CelloMomOnCars cities are going to have to upzone to get these people out of the danger zones. the resistance to anything other than suburban housing policies is killing our country.
CelloMom On Cars
"#NewZealand’s insurance market has historically concentrated on earthquake risk when setting reinsurance requirements and catastrophe modelling frameworks. The limited development of weather-related catastrophe models for New Zealand leaves insurers exposed to emerging climate-related threats."
https://www.insurancebusinessmag.com/nz/news/catastrophe/review--how-rising-climate-threats-reshape-new-zealands-insurance-landscape-520952.aspx
#HomeInsurance
CelloMom On Cars
"Insurance costs aren't just climbing in the US. In Germany, where floods are striking more often, #HomeInsurance premiums are predicted to double in the next 10 years.
In Australia — frequently ravaged by wildfires and flooding — 15% of households are experiencing "home insurance #affordability stress," which means they're plowing more than four weeks of their annual income into premiums."
https://www.dw.com/en/la-fires-cast-light-on-climate-change-insurance-crisis/a-71396879
CelloMom On Cars
This article points out that some homes are over-priced relative to their level of climate risk, and:
"US consultancy DeltaTerra Capital expects escalating ownership costs to cause a Great Recession-like correction in asset values affecting about a fifth of homes. Its founder Dave Burt was one of the “Big Short” investors who called the 2008 #MortgageCrisis."
Climate risk is US housing market’s neighbour from hell
https://www.ft.com/content/08cb8f8b-47b8-44ef-bbad-7ee268a98223
CelloMom On Cars
Insurance companies are financing oil and gas—even as climate change is pummeling their bottom line
"Fossil fuel companies made up 4.4% of the investment portfolio of the #insurance industry in 2023, up from 3.8% nine years earlier. Two insurance giants, Berkshire Hathaway and State Farm, increased their fossil fuel positions by around $200 billion in that period."
CelloMom On Cars
Banks are not investing enough in #CleanEnergy
"According to researchers at BloombergNEF, the ratio of spending on low-carbon infrastructure relative to fossil fuels needs to reach 4 to 1 by 2030 to limit #ClimateChange.
At the end of 2023, the so-called energy-supply banking ratio, which includes debt and equity underwriting, was 0.89 to 1, up from 0.74 in 2022 and 0.78 in 2021."
CelloMom On Cars
Climate risk analysis firm First Street:
"Between now and 2055, insurance premiums are projected to rise the most in Miami, jumping 322% from current levels, followed by Jacksonville, FL (226%), Tampa, FL (213%), New Orleans (196%), and Sacramento, CA (137%)."
https://www.realtor.com/news/trends/biggest-home-insurance-premium-hikes/
CelloMom On Cars
"Federal Reserve Chairman Jerome Powell has warned that obtaining #mortgages in certain parts of the United States may become nearly impossible in the future due to mounting challenges in the insurance sector. "
https://www.insurancebusinessmag.com/us/news/catastrophe/insurance-could-kill-mortgages-in-some-of-the-us--powell-524516.aspx
#HomeInsurance
CelloMom On Cars
Having #HomeInsurance may not be enough:
"The Washington Post used the 2020 CZU Lightning Complex fires and the 2021 Colorado Marshall Fire as examples of insurance companies failing to help most people rebuild.
In the former instance, less than a third of the homes lost in the fires were rebuilt. The Marshall Fire had a similarly devastating result. Around 80% of homeowners had insurance policies that wouldn't cover the cost of rebuilding."
https://www.thecooldown.com/green-business/homeowners-insurance-policies-covering-climate-change/
CelloMom On Cars
Quite apart from climate change:
"Insurance companies in the Sunshine State justified massive premium hikes for policyholders as necessary to cover losses at the same time that executives distributed $680 million in dividends to shareholders and diverted billions to affiliates."
https://www.newsweek.com/florida-insurance-scandal-huge-impact-homeowners-2037711
Thanks to @ghostdansing for the link
https://mastodon.social/@ghostdansing@nerdculture.de/114098189799625052
CelloMom On Cars
But banks and insurers barking up the fossil fuel tree are not even rewarded very well.
Even from a strictly dollars point of view, investing in fossil fuels has been a bad bet for at least a decade now.
CelloMom On Cars
Home insurance is a western thing.
"One in thirteen homeowners across the United States are UNinsured (7.4 percent)."
So 92.6% ARE insured.
https://consumerfed.org/wp-content/uploads/2024/03/Exposed-UninsuredHomes-1.pdf
Compare:
"Barely 3% of houses in India are insured. "
https://www.asiainsurancereview.com/Magazine/ReadMagazineArticle?aid=39698
"insurance penetration in Indonesia is relatively low amongst ASEAN countries at 1.4%. To illustrate, Singapore;s penetration rate is 12.5%, whilst Malaysia’s and Thailand’s are at 3.8% and 4.6%, respectively."
https://insuranceasia.com/event-news/indonesia-needs-little-tech-boost-insurance-penetration
CelloMom On Cars
Property Prices in Peril
"First Street thinks the value of real estate will decline by over $1 trillion by 2055. That's partly because many people will leave big parts of the country that are now experiencing growth, and partly because property values will have to adjust downward to compensate for higher #omeInsurance costs."
CelloMom On Cars
The writing has been on the wall for some time, this article spells it out:
"Because #HomeInsurance is required for most home loans, some economists are concerned that the insurance crisis could reignite a #MortgageCrisis."
CelloMom On Cars
Appalachians Are Trapped in a Disastrous Cycle of Flooding and Rebuilding
"Two years after the 2022 flood, major government funding for rebuilding still has not resulted in a significant number of homes. The state has planned seven communities on higher ground in eastern Kentucky that aim to house 665 new homes. As of early 2025, 14 houses had been completed."
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