Could Climate Change Break Home Insurance?

Homeownership has long been a pillar of the U.S. economy. For many Americans, a house is by far their largest asset. Naturally, they want to protect it in case of disaster, so they buy home insurance. Today, that model is under threat. Why? Climate change.

Seeing the increasing destruction wrought by a changing climate, private insurers have opted to reduce or eliminate coverage in some states. Now facing the risk of losing home insurance in addition to the ever-present threat of natural disasters, Americans living in risky areas might be forced to confront a decision to leave their homes for good. The government has thus far stepped in to replace fleeing insurers, though its public insurance programs are more expensive for both homeowners and taxpayers. However, there are a number of other solutions policymakers can consider to reduce the risk of a climate change-fueled collapse of U.S. home insurance.

This episode was originally released by Why It Matters on September 27, 2023.

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Host

Gabrielle Sierra
Podcast Host and Senior Producer

Episode Guests

David Marlett
Managing Director of the Brantley Risk & Insurance Center, Appalachian State University

Nancy Watkins
Principal and Consulting Actuary, Milliman

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