Homeowner expenses don't just consist of *** monthly mortgage and despite budgeting thoroughly for what you think you need, you may have missed these bank breaking bills. Homeowners insurance is not to be forgotten. The very thing that will protect you against damages or losses. And if it's not tied into your mortgage talks, news says you'll want to divide your annual insurance bills by 12 and put that amount aside, monthly, property taxes aren't ideal but are kept public to compare previous rates and private mortgage insurance is to protect the lender in case you stop making payments known as PMI, it usually costs 0.22% to 2.25% of your mortgage. Some other notable expenses include flood and title insurance, general utilities and renovations for those that like to keep it clean, cleaning fees, landscaping and possible pest control might also cost you *** pretty penny.
Homeowners insurance companies abandon California and Florida — find out what to do
With home insurance companies pulling out of states at high risk of climate disasters, what’s a homeowner to do? We’ll walk you through your options.
Updated: 4:00 PM CDT Jul 13, 2023
PHNjcmlwdCB0eXBlPSJ0ZXh0L2phdmFzY3JpcHQiIHNyYz1odHRwczovL3N0YXRpYy5teWZpbmFuY2UuY29tL3dpZGdldC9teUZpbmFuY2Vfdmlld3BvcnRfZGV0ZWN0aW9uLmpzPjwvc2NyaXB0PjxzY3JpcHQgYXN5bmMgdHlwZT0idGV4dC9qYXZhc2NyaXB0Ij5teWZpV2F0Y2hXaWRnZXQoJ215ZmlXaWRnZXRfMTEnKTtteWZpV2F0Y2hXaWRnZXQoJ215ZmlXaWRnZXRfMTEuMScpOzwvc2NyaXB0Pg==Elizabeth Rivelli is a freelance writer who specializes in insurance, with extensive experience in topics such as life insurance, property insurance, car insurance, and health insurance. Her work has appeared in Bankrate, Forbes Advisor, CNET, Investopedia, Insurance.com, Car and Driver, and Money Under 30. You can reach her at rivelli.elizabeth@gmail.com.Hearst Television participates in various affiliate marketing programs, which means we may get paid commissions on editorially chosen products purchased through our links to retailer sites. This may influence which products we write about and where those products appear on the site, but it does not affect our recommendations or advice, which are grounded in research.Mobile app users, click here for the best viewing experience.Depending on where you live, the effects of climate change can be seen throughout the seasons. Warmer temperatures are causing an uptick in destructive wildfires, droughts, and severe storms with heavy rainfall. Due to these extreme weather events and others, some home insurance companies have stopped selling new policies in the hardest-hit states.So, what does that mean? If you live in one of the states where homeowners insurance companies are withdrawing their business, like California or Florida, you might have a harder time getting coverage. Your home insurance premium could also get more expensive. However, it’s still important to have home insurance coverage, particularly if you live in an area with flooding or wildfires.In this article, we’ll explain how climate change is impacting homeowners insurance in high-risk states around the country. We’ll also give you some tips for getting homeowners insurance if you live in an area that is more prone to climate-related weather events and natural disasters.Need help finding homeowners insurance in your state? Start your search here.How climate change is affecting homeowners insuranceWhen you purchase a homeowners insurance policy, the insurance company takes on a certain amount of risk. If anything happens to your home or personal belongings, or if you get sued for a third-party bodily injury or property damage liability claim, the insurance company agrees to compensate you based on your insurance contract.One of the biggest factors that impacts the cost of home insurance is your location. If you live in an area that is more at risk for disasters, like hurricanes or wildfires, the insurance company charges you more. The idea is that homes located in high-risk areas are more likely to have insured losses, which means there’s a greater chance that the insurance company will have to provide a settlement.How is climate change impacting this? Well, homes located in some high-risk areas are even more likely to have insured losses. In addition, homes that weren’t previously considered high-risk may now be more likely to file claims due to the increasing rate of climate-related disasters, like wildfires, floods, tornadoes, and similar events.Some insurance companies are so concerned about the uptick in climate-related risks that they’ve stopped insuring new customers certain states. For example, State Farm announced that it would stop selling new home insurance policies to homeowners anywhere in California because of wildfires that have destroyed homes in recent years. (State Farm will continue honoring existing coverage.) Allstate also made a similar announcement.Homeowners in Florida are also losing options for home insurance. According to a spokesperson from the Insurance Information Institute, 15 insurance companies have stopped selling new home insurance policies in Florida over the last 18 months. This includes major insurers like Farmers. Not only is it becoming more difficult to find home insurance, but for many people, their insurance premiums are skyrocketing. Some homeowners have been forced to cancel their insurance policies because they can’t afford them. Without home insurance, homeowners are financially responsible for any damage to their homes or personal items, even in the event of a natural disaster.What types of homeowners insurance protect against climate-related disasters?Homeowners insurance provides comprehensive protection for many of the most common losses that homeowners can experience. A basic home insurance policy provides dwelling insurance, personal property insurance, medical payments insurance, liability insurance, and loss of use insurance.However, homeowners insurance doesn’t cover everything. Here are some additional policies that you might want to consider if you live in an area that’s prone to climate-related disasters.Flood insuranceMost home insurance policies don’t provide any coverage for flooding. There may also be limited coverage for residual damage, like mold. If you live in a high-risk area for flooding or rain storms, it’s a good idea to purchase a separate flood insurance policy. The most common way to get flood insurance is through the National Flood Insurance Program (NFIP).Earthquake insuranceIf you live in an area that is prone to earthquakes or other types of earth movement, like landslides, you should consider purchasing a separate earthquake insurance policy. Regular home insurance policies usually exclude coverage for earthquake damage, which means you would have to pay out-of-pocket to repair or build your home after an earthquake.Fire insuranceFire insurance is also becoming a necessity for many homeowners in California and other states that experience wildfires. While basic home insurance policies include wildfires as a covered peril, homeowners in the most high-risk areas may need to get a separate fire insurance policy or endorsement for more protection. How to shop for homeowners insurance if you live in a high-risk areaShopping for homeowners insurance can be slightly more difficult if you live in an area that is prone to certain climate disasters. To get the best protection for your home, there are a few things to keep in mind:Purchase enough coverage: If something happens to your home, you want to have enough coverage to pay for the repairs or to rebuild your home from the ground up. Make sure to choose an appropriate amount of coverage for your dwelling and personal property. If you’re not sure how much coverage you need, speak to an agent.Research your state’s FAIR plan: If you can’t get approved for home insurance because you live in a high-risk area, you might be able to get coverage through your state’s Fair Access to Insurance Requirements (FAIR) plan. These plans can be expensive, and they offer limited coverage, but for some homeowners, FAIR plans are the only way to secure home insurance coverage due to their location.Consider adding endorsements: Home insurance doesn’t cover everything, so adding endorsements to your policy can help fill the gaps. Depending on your location, you might need to get separate flood insurance or earthquake insurance policies. You can also get valuable items coverage, water backup coverage, identity theft coverage, and home business coverage, depending on your insurance company.Look for insurers with discounts: Most home insurance companies offer discounts that can reduce your premium. Every insurer offers different discounts, but you can often get savings for insuring a new home, bundling a home and auto policy, having an impact-resistant roof, having a security system in your home, and paying your annual premium in full.Get multiple quotes: The cost of home insurance depends on many factors, and the insurance company you choose can also impact your rate. To find the most affordable policy for your situation, it’s helpful to compare quotes from several insurance companies. Review your policy annually: Your home insurance coverage needs might change over time. It’s important to review your home insurance policy every year to make sure you have the right types of coverage and the right amount of coverage to protect your home. Bottom lineClimate change is impacting the home insurance market in many states. But as climate-related disasters become more common, it’s even more important for homeowners to have comprehensive home insurance coverage. Before you buy home insurance, make sure to assess your coverage needs, then get quotes to find the most affordable policy. You should also review your home insurance policy every year to make sure you’re sufficiently covered. Find homeowners insurance in your state. Editorial Disclosure: All articles are prepared by editorial staff and contributors. Opinions expressed therein are solely those of the editorial team and have not been reviewed or approved by any advertiser. The information, including rates and fees, presented in this article is accurate as of the date of the publish. Check the lender’s website for the most current information.This article was originally published on SFGate.com and reviewed by Lauren Williamson, who serves as Financial and Home Services Editor for the Hearst E-Commerce team. Email her at lauren.williamson@hearst.com.
Elizabeth Rivelli is a freelance writer who specializes in insurance, with extensive experience in topics such as life insurance, property insurance, car insurance, and health insurance. Her work has appeared in Bankrate, Forbes Advisor, CNET, Investopedia, Insurance.com, Car and Driver, and Money Under 30. You can reach her at rivelli.elizabeth@gmail.com.
Hearst Television participates in various affiliate marketing programs, which means we may get paid commissions on editorially chosen products purchased through our links to retailer sites. This may influence which products we write about and where those products appear on the site, but it does not affect our recommendations or advice, which are grounded in research.
Mobile app users, click here for the best viewing experience.
Depending on where you live, the effects of climate change can be seen throughout the seasons. are causing an uptick in destructive wildfires, droughts, and severe storms with heavy rainfall. Due to these extreme weather events and others, some home insurance companies have stopped selling new policies in the hardest-hit states.
So, what does that mean? If you live in one of the states where homeowners insurance companies are withdrawing their business, like California or Florida, you might have a harder time getting coverage. Your home insurance premium could also get more expensive. However, it’s still important to have home insurance coverage, particularly if you live in an area with flooding or wildfires.
In this article, we’ll explain how climate change is impacting homeowners insurance in high-risk states around the country. We’ll also give you some tips for getting homeowners insurance if you live in an area that is more prone to climate-related weather events and natural disasters.
Need help finding homeowners insurance in your state? Start your search here.
How climate change is affecting homeowners insurance
When you purchase a homeowners insurance policy, the insurance company takes on a certain amount of risk. If anything happens to your home or personal belongings, or if you get sued for a third-party bodily injury or property damage liability claim, the insurance company agrees to compensate you based on your insurance contract.
One of the biggest factors that impacts the cost of home insurance is your location. If you live in an area that is more at risk for disasters, like or wildfires, the insurance company charges you more. The idea is that homes located in high-risk areas are more likely to have insured losses, which means there’s a greater chance that the insurance company will have to provide a settlement.
How is climate change impacting this? Well, homes located in some high-risk areas are even more likely to have insured losses. In addition, homes that weren’t previously considered high-risk may now be more likely to file claims due to the increasing rate of climate-related disasters, like wildfires, floods, tornadoes, and similar events.
Some insurance companies are so concerned about the uptick in climate-related risks that they’ve stopped insuring new customers certain states. For example, that it would stop selling new home insurance policies to homeowners anywhere in California because of wildfires that have destroyed homes in recent years. (State Farm will continue honoring existing coverage.) also made a similar announcement.
Homeowners in Florida are also losing options for home insurance. According to a spokesperson from the Insurance Information Institute, have stopped selling new home insurance policies in Florida over the last 18 months. This includes major insurers like Farmers.
Not only is it becoming more difficult to find home insurance, but for many people, their insurance premiums are skyrocketing. Some homeowners have been forced to cancel their insurance policies because they can’t afford them. Without home insurance, homeowners are financially responsible for any damage to their homes or personal items, even in the event of a natural disaster.
What types of homeowners insurance protect against climate-related disasters?
Homeowners insurance for many of the most common losses that homeowners can experience. A basic home insurance policy provides dwelling insurance, personal property insurance, medical payments insurance, liability insurance, and loss of use insurance.
However, homeowners insurance doesn’t cover everything. Here are some additional policies that you might want to consider if you live in an area that’s prone to climate-related disasters.
Flood insurance
Most home insurance policies don’t provide any coverage for flooding. There may also be limited coverage for residual damage, . If you live in a high-risk area for flooding or rain storms, it’s a good idea to purchase a separate policy. The most common way to get flood insurance is through the National Flood Insurance Program (NFIP).
Earthquake insurance
If you live in an area that is prone to earthquakes or other types of earth movement, like landslides, you should consider purchasing a separate earthquake insurance policy. Regular home insurance policies usually exclude coverage for earthquake damage, which means you would have to pay out-of-pocket to repair or build your home after an earthquake.
Fire insurance
Fire insurance is also becoming a necessity for many homeowners in California and other states that experience wildfires. While basic home insurance policies include wildfires as a covered peril, homeowners in the most high-risk areas may need to get a separate fire insurance policy or endorsement for more protection.
How to shop for homeowners insurance if you live in a high-risk area
Shopping for homeowners insurance can be slightly more difficult if you live in an area that is prone to certain climate disasters. To get the best protection for your home, there are a few things to keep in mind:
- Purchase enough coverage: If something happens to your home, you want to have enough coverage to pay for the repairs or to rebuild your home from the ground up. Make sure to choose an appropriate amount of coverage for your dwelling and personal property. If you’re not sure how much coverage you need, speak to an agent.
- Research your state’s FAIR plan: If you can’t get approved for home insurance because you live in a high-risk area, you might be able to get coverage through your state’s (FAIR) plan. These plans can be expensive, and they offer limited coverage, but for some homeowners, FAIR plans are the only way to secure home insurance coverage due to their location.
- Consider adding endorsements: Home insurance doesn’t cover everything, so adding endorsements to your policy can help fill the gaps. Depending on your location, you might need to get separate flood insurance or earthquake insurance policies. You can also get valuable items coverage, water backup coverage, identity theft coverage, and home business coverage, depending on your insurance company.
- Look for insurers with discounts: Most home insurance companies offer discounts that can reduce your premium. Every insurer offers different discounts, but you can often get savings for insuring a new home, bundling a home and auto policy, having an impact-resistant roof, having a security system in your home, and paying your annual premium in full.
- Get multiple quotes: The cost of home insurance depends on many factors, and the insurance company you choose can also impact your rate. To find the most affordable policy for your situation, it’s helpful to compare quotes from several insurance companies.
- Review your policy annually: Your home insurance coverage needs might change over time. It’s important to review your home insurance policy every year to make sure you have the right types of coverage and the right amount of coverage to protect your home.
Bottom line
Climate change is impacting the home insurance market in many states. But as climate-related disasters become more common, it’s even more important for homeowners to have comprehensive home insurance coverage. Before you buy home insurance, make sure to assess your coverage needs, then get quotes to find the most affordable policy. You should also review your home insurance policy every year to make sure you’re sufficiently covered.
Find homeowners insurance in your state.
Editorial Disclosure: All articles are prepared by editorial staff and contributors. Opinions expressed therein are solely those of the editorial team and have not been reviewed or approved by any advertiser. The information, including rates and fees, presented in this article is accurate as of the date of the publish. Check the lender’s website for the most current information.
This article was originally published on and reviewed by Lauren Williamson, who serves as Financial and Home Services Editor for the Hearst E-Commerce team. Email her at lauren.williamson@hearst.com.
