Climate change & insurability
2023-12-01 22:03:14.086538+01 by Dan Lyke 0 comments
And as we start to necessarily dial back automobile subsidies, a lot of the rural and suburban bubble is gonna get hit even harder: In the Face of Mounting Climate Risks, the Insurance Safety Net Is Falling Apart
While insurance prices have soared, a recent report from the nonprofit First Street Foundation estimates that 39 million homes are covered at prices artificially lower than their true risk. The authors suggest that state regulations capping premiums and government-backed insurer-of-last-resort programs have concealed the extent of the crisis. They predict that as disasters continue surging, what they call the “growing climate bubble in the housing market” will pop—leaving millions of homes uninsurable and destroying their value. The average homeowner who loses an insurance policy automatically sees a drop of more than 10 percent in the home’s value, the report notes. “If the value of their home plummets or if the credit agencies downgrade their communities,” Hill says, “one of my big fears is we’re going to have a lot of people trapped in places that are unsafe—economically trapped.”