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
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."
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."
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.
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
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."
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."
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/
"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
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/
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
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."
"#TropicalCycloneAlfred is set to hit south-east #Queensland and northern NSW's coastlines, with damaging winds, flash flooding and dangerous storm times predicted.
Rising #insurance costs are already pricing families out with potentially devastating consequences. One in five Australians polled by the think tank are uninsured or under-insured, representing around 1.4 million homes at risk."
Billions of dollars of damage are expected to follow Tropical Cyclone Alfred, Treasurer Jim Chalmers says, as new research suggests one in five Australians are facing an "impossible choice" when it comes to insurance costs.
"California, along with Florida, now finds itself at the epicenter of an insurance crisis that has the potential to trigger a 2008-caliber financial collapse, as climate-driven disasters threaten to overwhelm insurers.
The heart of this problem is not only #ClimateChange but the commodification of housing itself, which turned a simple concept (basic shelter) into a nest egg at best and a risky financial asset at worst."
https://www.thenation.com/article/society/la-wildfires-insurance-state-intervention-housing/
#HomeInsurance
"One thing remains as clear as it was when [Mike] Davis articulated it 30 years ago: It is neither fiscally nor environmentally sustainable to keep building single-family homes in extremely risky areas."
https://www.thenation.com/article/society/la-wildfires-insurance-state-intervention-housing/
The fact that the home is often the nest egg also drives the NIMBY mentality (together with various prejudices).
#HomeInsurance
Resilience (and lower #HomeInsurance rates) is about not building where you shouldn't be building.
“It’s particularly relevant to western Sydney, where over the last few years, there has been continued development in areas where it’s kind of debatable about whether we should actually allow development in those areas,” Paddam said.
The accelerating risk of climate disasters including floods, bushfires and storms means Sydneysiders in some parts of the city are paying over three times more for home insurance than others.
"IAG chief executive Amanda Whiting said insurers are increasingly using detailed risk assessments for individual properties, rather than relying solely on regional data.
She added that insurance providers should clearly communicate when a proposed development is unlikely to be insurable, which could prevent homes from being built in unsuitable locations."
https://www.insurancebusinessmag.com/nz/news/catastrophe/industry-leaders-warn-climate-change-could-make-nz-homes-uninsurable-528668.aspx
#HomeInsurance
"#Tariffs are expected to have a significant impact on the cost of insurance, which is bracing for more disasters caused by a warming world — hurricanes, tornadoes, earthquakes, wildfires, and flooding."
https://cleantechnica.com/2025/03/30/insurance-industry-predicts-more-future-losses-now-tariffs-add-to-the-impact-of-climate-claims/
#HomeInsurance
The rise in home construction costs is already a big part of why #HomeInsurance rates have shot up. Tariffs will spike the price of building materials.
https://insideclimatenews.org/news/08042025/todays-climate-tariffs-insurance-premiums-increase/
"State Farm on Feb. 3 asked Insurance Commissioner Ricardo Lara to allow it to urgently raise its prices by an average of almost 22% for homeowners policies. But attorneys for State Farm and the insurance department said Tuesday the company is now only asking for a 17% hike."
https://www.sacbee.com/news/politics-government/capitol-alert/article303761776.html#storylink=cpy
"New data out today exposes the electorates where homes and businesses are most at risk from #climate-fuelled flooding, bushfires, tropical cyclone winds, coastal inundation, and extreme wind.
The #ClimateRisk Map, an interactive online map using fresh data from Climate Valuation, allows every Australian to see the climate risks in their local area."
https://www.climatecouncil.org.au/resources/climate-change-threatens-the-great-australian-dream/
#Australia
Homeowners insurance in an era of climate change
"The U.S. Treasury’s Federal Insurance Office has posted ZIP code level data for 2018-2022 showing that #HomeInsurance is becoming more costly and harder to procure for millions of Americans as the costs of climate-related events pose growing challenges to insurers and their customers. The [data] covers more than 330 private insurers and about 50 million homeowner insurance policies for each year."
Incl. interactive map.
https://www.brookings.edu/articles/homeowners-insurance-in-an-era-of-climate-change/
Non-renewal rates on #HomeInsurance are highest in South Carolina (and they are very high).
Report and data can be downloaded from the US Treasury's website
https://home.treasury.gov/news/press-releases/jy2791
What’s driving people out of Houston? New report points to 3 things
"Vulnerable households are located in areas most susceptible to flooding and extreme heat.
Many of these communities are underinsured.
Perhaps most alarming, the rising cost of #HomeInsurance driven by #climate risks could add more than $15,000 to the overall cost of owning a home, pushing homeownership even further out of reach for many.
"Warren Buffett, Chairman of Berkshire Hathaway, warned that "storm damage is continuing to increase," and "one day, there could be truly massive insurance losses."
Günter Thalinger, Head of Sustainability at global insurer Allianz, pointed out that "if insurance supply is interrupted, the entire financial services sector could face paralysis," highlighting the potential structural risk."
https://biz.chosun.com/en/en-international/2025/06/27/CPIQV2HMTZAWJCGHIYPCVITXHM/
Translation: mortgage and banking crisis.
In this long read, Pilita Clark lists some who have been warning about a 2008-style financial meltdown triggered by a climate-induced housing crisis:
The US Senate Budget Committee (Dec 2024);
The US Financial Stability Board;
Fed chair Jerome Powell;
Investor Warren Buffett;
Allianz board member Günther Thallinger.
This is about physical, not financial, risk. And as an economist points out,
“This type of climate risk is not cyclical. It’s heading in one direction.”
https://www.ft.com/content/9e5df375-650d-492e-ba51-fb5a34e6ddd6
We May Have to Take Climate Risks Into Our Own Hands Now
"The most meaningful thing you can do on your own is harden your own home against relevant disasters.
One of the only ways home hardening and mitigation makes a difference for insurance is when it’s done on a neighborhood scale. For instance, in 10 states, communities that have been certified as firewise through the National Fire Protection Association are able to get insurance discounts."
https://www.motherjones.com/environment/2025/07/home-hardening-diy-disaster-preparedness-climate-risk-fires-flooding-hurricanes/
#HomeInsurance
"Over the past half decade, the top 19 global reinsurers have more than halved their exposure to insured catastrophe losses.
The reinsurance industry covered just over 10% of total insured catastrophe losses last year, compared with about 25% in 2019 and well below the historical average of 20%, according to S&P."
How Climate Risks Are Putting Home Insurance Out of Reach
“The insurance crisis in the U.S. is the canary in the coal mine, and the canary is dead,” says a former California official.
https://e360.yale.edu/features/climate-change-home-insurance
#HomeInsurance
After years underestimating the risks posed by climate-fueled disasters, the U.S. home insurance industry is in turmoil. In vulnerable areas, rising insurance costs are upending housing markets and communities, as homeowners scramble to try to find insurance they can afford.
"Climate change and extreme weather has been a factor into the steep hikes, with insured losses from extreme weather hitting a record $8.5 billion in 2024, a Canadian record. Such frequent, severe disasters, the company noted in the report, are driving up home insurance claims and expenses across the country, forcing insurers to raise premiums to keep pace with the heightened risk."
https://www.insauga.com/climate-change-extreme-weather-leading-to-soaring-home-insurance-rates-in-ontario-study/
#HomeInsurance
Günther Thallinger – CEO of insurer Allianz – sees it very clearly.
"This is already happening. Entire regions are becoming uninsurable.
A house that cannot be insured cannot be mortgaged. No bank will issue loans for uninsurable property. Credit markets freeze. This is a climate-induced credit crunch.
The idea that market economies can continue to function without insurance, finance, and asset protection is a fantasy."
“When insurance becomes unaffordable or unavailable, households are exposed, property values fall, mortgages become harder to secure, and the risk of a wider financial crisis grows,” researchers say.
"Two homeowners in Washington state who have seen sharp increases in their home insurance premiums in recent years have brought a new lawsuit against major oil and gas companies—the first of its kind aiming to hold Big Oil responsible for climate-related spikes in insurance costs."
https://insideclimatenews.org/news/05122025/washington-homeowners-sue-oil-companies-over-insurance-rates/
#HomeInsurance
"People keep moving into risky areas. In my view, this isn't really about individual choice — it's about policy failure.
When local governments restrict development through exclusionary zoning, they're effectively pricing out working families and pushing them toward risk.
When a society forces people to choose between paying for housing and staying safe, that society has failed. Housing should be a right, not a risk calculation."
https://www.timesfreepress.com/news/2025/dec/13/times-opinion-moving-to-a-climate-disaster-zone/
"The Trump administration’s policies on climate, cutting funding to key programs, [and] reducing access to and limiting the collection of climate data are contributing to an increase in property insurance rates for homeowners, said insurance industry analysts and experts.
Steep tariffs on materials like lumber, steel, & aluminum are raising construction and repair costs, which will likely be passed on to consumers through higher home insurance premiums."
https://yaleclimateconnections.org/2025/12/trumps-anti-climate-policies-are-driving-up-insurance-costs-for-homeowners-say-experts/
#HomeInsurance
"The lesson from states already under insurance stress is clear: Michigan still has time to blunt the impact — but not indefinitely. Without sustained investment in infrastructure, updated risk data, and resilient design, climate costs will continue migrating from disaster headlines to monthly insurance bills, mortgage payments, and business balance sheets."
"The federal government is considering implementing mandatory bushfire-resilience star ratings for houses in Australia’s fire-prone regions in an attempt to encourage owners to retrofit homes "
We also need a flood rating. Some places already have an energy rating mandatory at the time of sale. This way you know what you're buying.
"Since the 1990s, American homes have been systematically underinsured in the event that they are completely destroyed.
Until then most US home insurance policies included a guaranteed clause to replace no matter the cost. But as American houses got bigger and more expensive, the guarantee lost ground to replacement-cost-value coverage, which sets an upper limit on how much the insurance company will pay out."
And rebuilding costs are routinely underestimated.
"The devastating impacts are accelerating faster than the work to keep communities protected, they said: torrential winter rains are arriving 20 years earlier than climate models projected. While those forced from homes engulfed by filthy water are suffering today, a darker question is looming: will some settlements have to be abandoned?"
https://www.theguardian.com/news/ng-interactive/2026/jan/31/climate-crisis-flood-risk-britain
"The fires that ravaged Los Angeles County last January destroyed or partially burned more than 18,000 homes. A year later, recovery is lagging: Fewer than a dozen destroyed homes have been rebuilt, and less than 1,000 rebuilds are on track for this year.
Displaced owners of leveled or damaged homes widely report that insurers are low-balling and delaying repair settlements, a process they believe is deliberately designed to slow things down."
The fires that ravaged Los Angeles County last January destroyed or partially burned more than 18,000 homes and other structures and blanketed a like number in toxic smoke and soot. A year later, recovery is lagging: Fewer than a dozen destroyed homes have been rebuilt, and less than 1,000 rebuilds are on track for this year.
"Protection Gap Deepens: The share of uninsured homes in the U.S. has more than doubled—from 5% in 2019 to 12% in 2025—as the rising climate risk and market dynamics combine to limit the private insurance sector’s ability to close this gap."
https://ethicalmarketingnews.com/escalating-extreme-weather-risks-push-u-s-insurance-system-to-breaking-point
#HomeInsurance
A new report from World Wildlife Fund, Tackling The Insurance Protection Gap, warns that the rising frequency and severity of extreme weather is driving an insurance crisis in the United States, leaving millions of households and businesses financially exposed. “The insurance protection gap is the canary in the coal mine for the U.S. economy, and
Evaluating climate risk for a particular home is much like assessing the weather forecast: many people consult more than one source.
“Try to look at as many different sources of information as possible. And if they’re all telling you the same thing, then that can give you a more comprehensive picture.”
https://insideclimatenews.org/news/10022026/todays-climate-risks-buying-homes-flooding-wildfire/
Beyond black box models,
Data on wildfire risk:
"The nonprofit research group CarbonPlan launched the free, user-friendly app called Open Climate Risk on Tuesday. It allows anyone to enter an address and view a wildfire risk score, on a scale of zero to 10, along with an explanation of how it was calculated. The underlying methodology, data, and code are all public. It’s the first fully open platform of its kind, according to CarbonPlan."
On a warming planet, knowing whether the home you’re about to invest your life savings in is at risk of being wiped out by a wildfire or drowned in a flood becomes paramount. And yet public data is almost nonexistent. While private companies offer property-level climate risk assessments — usually fo...
"[Connecticut] has launched a public climate-risk mapping tool where residents can see the estimated flood exposure of their property — along with wildfire, wind and other climate risks.
FEMA maps do not include localized flooding from heavy rainfall.
Before launching the portal, the department asked First Street to compare its projections with the August 2024 flood footprint. The state found the modeled maps closely aligned with properties that experienced flooding."
"New attribution research shows how extra heat in the atmosphere can turn thunderstorms into factories for dangerous, softball-size hail.
Munich Re researchers say severe hailstorms can cause billions of dollars in damage in a matter of minutes when they hit cities packed with cars, glass roofs and solar panels."
https://insideclimatenews.org/news/09032026/warming-intensifies-hail-thunderstorms/
[Australian] Banks face climate stress as home insurance crisis widens
"A widening insurance protection gap – the difference between the amount of insurance in place and the actual cost of recovery from a disaster – will create credit risk for banks which use residential property as the security for loans, based on a high-risk scenario for global warming."
https://www.afr.com/companies/financial-services/rising-premiums-to-force-more-homeowners-to-drop-insurance-apra-warns-20260323-p5rosn
#HomeInsurance
Between 2021 and 2024, #HomeInsurance costs increased by about 50% in Illinois, and this year, the state’s insurance rates are expected to climb about 5%.
Illinois-based insurance giants pointed to extreme weather as driving up costs. In 2024, only Texas reported more hail damage than Illinois.
“We are already seeing the impacts of the climate crisis show up in people’s monthly bills, and rising homeowners insurance costs are one of the clearest examples,” she said."
"During dry periods, clay soils lose their moisture and start to shrink, risking the foundations of homes to collapse. When heavy rainfall hits, the clay starts to swell, absorbing excess water.
The alternation of these dry-then-wet periods are repeated over time, gradually weakening soils and foundations.
This phenomenon affects 54 per cent of detached houses in France."
"Worried about wildfires sending claims soaring this year, Canada's property and casualty insurers are pushing owners to flood- and fire-proof homes and urging the government to take climate issues more seriously despite economic turmoil."
https://www.reuters.com/sustainability/cop/canadian-insurers-fortify-homes-urge-carney-put-climate-first-wildfire-season-2026-04-14/
#HomeInsurance
CelloMom On Cars
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