Climate Reality, Disguised As Spiking Insurance Costs, Arrives For The American Dream Of Retirement
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While Florida residents are not the only ones wrestling with this issue, the state’s popularity with retirees means that it is a problem a growing number will confront, experts say. When drawing up a budget for living on a fixed income, most would-be retirees think about services and goods, such as doctor visits or prescription drugs, that are likely to cost more in the future. Almost no one thinks of home insurance — an omission insurance professionals warn will be an increasingly costly mistake.
Many Americans’ plans to retire in a coastal Sunbelt state or a scenic mountain hamlet are on a collision course with extreme weather — and the property damage that follows. “In some regions, we already see changing weather patterns, most likely driven by climate change, already having an impact,” said Ernst Rauch, chief climate and geoscientist at the reinsurance company Munich Re.
After absorbing punishing losses from floods, hurricanes and wildfires in recent years, many insurers are re-evaluating their risk modeling practices. The upshot for many homeowners is higher property insurance bills. Others can find themselves struggling to get a policy at any price. “In certain parts of the country, the insurance situation has really been difficult — in particular, Florida and that area, including Louisiana and the Gulf states,” said Nancy Albanese, vice president of personal insurance at BMT Insurance Advisors. “The other market which is very difficult is California, and some of the Western states that are exposed to wildfire.” She added: “When we encounter a client who needs coverage in Florida, we know that’s going to be a huge challenge.”
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Ms. Albanese said that recently an insurer dropped one of her clients, who was already paying $22,000 a year to insure a coastal Florida property. After some scrambling, Ms. Albanese was able to find the client coverage through a “surplus lines” provider — an insurer of last resort for the highest-risk policies — but at double the cost. “It’s been back-to-back years of these rate increases, and I can think of at least one client who says they’re planning to sell their Florida property just because it’s just getting to be outrageous to insure,” Ms. Albanese said. “I’ve also had clients purchase properties in Florida recently, unaware of what the insurance market was like down there and really having them be just shocked — they just did not realize how high their premiums would be.”
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https://climatecrocks.com/2022/02/21/retirees-squeezed-by-climate-pumped-home-insurance/
