WASHINGTON, D.C. — Researchers say climate change is causing more extreme weather events to happen more often. That could come with a higher price tag for home and car insurance.
According to data from the National Oceanic and Atmospheric Administration, weather and climate disasters that cost more than $1 billion in damages have risen 154% from the 20-year period from 1983 to 2002 and the 20-year period from 2003 to 2022.
That has translated to massive losses for insurance companies. Insurers hit more than $50 billion in natural catastrophe insured losses in just the first half of 2023.
At a House hearing on Thursday, insurers argued their losses have required them to raise premiums.
“Ultimately insurers will need to make enough premiums to be able to pay losses long-term,” said Robert Gordon, senior vice president of the American Property and Casualty Insurance Association (APCIA).
The average national home insurance costs rose an eyewatering 21 percent from May 2022 to May 2023, according to insurance marketplace PolicyGenius.
At the hearing, insurance industry experts and policy makers discussed solutions to keep home and car insurance rates from skyrocketing.
Rep. Warren Davidson, R-Ohio, who chaired the hearing, supports policies that encourage responsible home building.
“Some people are complaining that it’s hard to get new multi-family development in these areas. You’re like, that’s what it’s supposed to do. It’s supposed to say, build in a different area where it’s not in a floodplain or price it in a way that you can recover the cost of building in that area,” Davidson said.
Davidson is leading a charge to reauthorize the National Flood insurance Program (NFIP), which offers flood insurance to homeowners in communities that agree to limit development in flood plains.
The measure is set to expire on Nov. 17. Davidson said he hoped to reauthorize it apart from the 12 federal appropriation bills that fund the government for an entire year. Amid partisan disputes, the bills are unlikely to be passed before the deadline.