The next climate crisis? The collapse of homeowners’ insurance

According to the National Centers for Environmental Information, 2023 set an unfortunate new record: 28 separate weather and climate disasters costing at least 1 billion dollars in the U.S., the most ever. This growing toll of climate-related damage has dramatically impacted homeowner insurance policies, in ways both global — think insurance companies pulling out of states like California — and local.

Take the 2018 Camp Fire, the second-deadliest wildfire in U.S. history (after last year’s fire in Lahaina, Hawaii). One former homeowner in the town of Paradise, California — which was essentially destroyed in the blaze — recounts how the fire itself was just the beginning of the problems the disaster forced him and his family to confront. In the months following, the writer describes entering “a long and traumatic nightmare of dealing with our insurer,” ending with hundreds of thousands of dollars’ worth of denied claims and ultimately relocation. But the piece isn’t just a first-person recollection. It also takes an outward turn to look at the overall state of homeowners’ insurance in the era of climate change: “In the end, it turns out that we didn’t ‘just have a bad experience.’ No, it turns out that we were just on the leading edge of the collapse of the insurance industry. We were ahead of the curve.”

The picture ahead is still forming, but the outlook is bleak. Five trends you may start seeing in your own insurance market: increased rates, reduced coverage, denied/lowballed claims, making policies available only to the safest customers, and insurers leaving risky areas altogether.

Not only do insurance issues have long-lasting impacts for affected communities (in Paradise, “five years after the Camp Fire, only about 2,500 homes have been rebuilt — out of the 14,000 that were destroyed”) but the potential cascade of effects for the housing market and overall economy could be dire, an example of how climate change spirals out into an everything problem. Maybe worth revisiting this piece from 2018 about the 5 best places to live in 2100?

What else we’re reading

• In the tragic story of Alexei Navalny, the Russian opposition leader who died in prison earlier this month, political activist Lawrence Lessig sees a rare example of an activist who simply asks (and then does) what is right. Lessig writes: “In the vast sweep of history, there is just this truth: Navalny-types rarely trigger revolutions. Realists never do.”
• Beyonce’s forthcoming album is just part of a larger cultural trend of black artists reclaiming “country,” writes Medium staffer Adrienne Gibbs. Writers, visual artists — and yes, global recording artist superstars — are “reviving the histories, memories and modern-day trials of the Black towns, the Black farmers, the Black cowboys, and the Black artists who are part and parcel of rural culture and therefore should be considered part of the Americana narrative.”

Your daily dose of practical wisdom

Maybe the most important thing you can do today is…nothing: “Have a think about how to spend the next ten minutes you find free in your schedule. Rather than succumb to the guilty feeling of production, maybe stand outside with a cup of something warm, look up at the clear sky, and contemplate your own insignificance.”

Written by Scott Lamb
Edited and produced by Jon Gluck & Carly Rose Gillis

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