Climate Change Fuels Insurance Crisis, Senate Data Shows
Washington, D.C.—A new dataset released by Senator Sheldon Whitehouse (D-RI), Chairman of the Senate Budget Committee, reveals a deepening crisis in homeowners’ insurance driven by climate change. The data, collected from 2018 to 2023, provides county-level information on insurance non-renewals across all 50 states and the District of Columbia. This unprecedented public accounting highlights the growing economic threat posed by climate change.
“Climate change is not just about polar bears and melting icebergs anymore,” stated Chairman Whitehouse. “It’s also about climate-flation bleeding family budgets with higher costs for insurance, groceries, and health care—and cascading economy-wide shocks. Our new data reveal that the failure to deal with climate change also affects whether families can even get homeowners insurance, which threatens their ability to get a mortgage, which spells trouble for property values in climate-exposed communities across the country. If Republicans are serious about staving off such an economic catastrophe, they must take their hands out of Big Oil’s pockets and take climate change seriously. Our economy, our country, and our future are on the line.”
The Senate Budget Committee’s investigation, launched last fall, obtained data from approximately two dozen insurance companies, representing about 65% of the national homeowners insurance market. The data encompasses 249 million insurance policies.
Key Findings
The new report, the culmination of the Committee’s investigation, confirms that climate change is significantly impacting insurance markets.
- Rising Non-Renewal Rates: The data demonstrate a clear correlation between climate-related risks and increasing non-renewal rates.
- Wider Impact: While Florida, California, and Louisiana have faced the brunt of these issues, the data reveals that other areas, including southern New England, parts of Montana, North Carolina, New Jersey, New Mexico, South Carolina, and Oklahoma, are also experiencing rising rates of non-renewal.
- Cost of Living: There is a positive correlation between rising non-renewal rates and increasing premiums nationwide, highlighting the impact of climate change on the cost of living.
These findings show how climate-related losses are making it harder for the insurance industry to price risk, which has already led to skyrocketing premiums and growth in non-renewals.
Background on the Investigation
The Senate Budget Committee’s investigation, launched in the fall of 2023, examined the risks that climate change poses to the U.S. economy and federal budget. The Committee focused on non-renewal data because industry experts warn that increasing non-renewal rates signal market instability.
The Committee requested documentation and information from 41 insurance companies operating in California, Louisiana, Florida, and Texas to evaluate their plans to address the increase in underwriting losses from climate disasters. The investigation underscores the systemic risks posed by more intense storms and rising sea levels, factors that could render over $1 trillion in coastal real estate uninsurable and unmortgageable.
The Senate Budget Committee held its final hearing of the Congress on December 18, 2024, titled “Next to Fall: The Climate-Driven Insurance Crisis is Here—And Getting Worse” to examine the new data.
