Guides
Climate change and home insurance: what's changing
How wildfire, storms, flooding and heat, plus more homes in harm's way and costlier repairs, feed into premiums, deductibles and availability.
Climate change reaches your homeowners policy through the claims insurers pay. Hotter, drier conditions make large wildfires more likely, and a warmer atmosphere can change how storms and rainfall behave, so some perils have become more frequent or more expensive to cover. But climate is one force among several. More homes sit in exposed places, repairs cost more, and reinsurance was repriced after 2022, and experts disagree about how to split the blame. What you see at renewal is the combined result: higher premiums in exposed areas, tougher deductibles and roof terms, and in the worst cases a nonrenewal letter.
What the insurers' own numbers show
Insured losses have run high for years. Aon put U.S. insured natural catastrophe losses at $103.1 billion in 2025, according to Triple-I's compilation of Aon data as of January 2026. Severe convective storms accounted for $52.3 billion of that, wildfire, drought and heatwave together for $43.0 billion, and tropical cyclones for only $0.19 billion, because 2025 was a quiet hurricane year for the U.S. mainland. Swiss Re Institute counted secondary perils such as storms, floods and wildfires at a record 92% of global insured losses in 2025.
The longer-run trend is the point. Artemis, summarizing Swiss Re's remarks in September 2026, reported that global insured natural catastrophe losses continue to follow a 5% to 7% annual growth rate, "driven by increasing exposures, rising asset values and changing hazard patterns." Note what that list contains. Climate appears only as "changing hazard patterns," one item among three.
A quiet stretch does not reverse the trend. Swiss Re Institute put first-half 2026 insured losses at $42 billion, 16% below the 10-year average, and said in its August 2026 release that the biggest storm outbreaks had largely spared the most exposed regions. One major hurricane or wildfire, its head of catastrophe perils said, "can quickly change the picture."
How much is climate, and how much is everything else
This is the contested part, and both sides have evidence.
The exposure argument. A 2023 Aon analysis, reported by Insurance Day, attributed more than 80% of the rise in severe convective storm insured losses since 1990 to exposure growth: more and costlier property in the path of storms, rather than a change in the storms. Moody's, in a May 2026 analysis covered in severe convective storms and rising premiums, points to housing stock growth, repair prices and vulnerable asphalt roofs. Say rebuilding a house now costs half again what it did a decade ago: the same hailstorm costs the insurer more even if nothing about the storm changed.
The hazard argument. Attribution scientists study individual events. World Weather Attribution's analysis of the January 2025 Los Angeles fires estimated that human-caused warming made the hot, dry, windy conditions about 35% more probable and about 6% more intense, and had lengthened the dry season by roughly 23 days (WWA, January 28, 2025). The same study stressed how exposed the area was. The fires cost about $40 billion in insured losses by the estimates of Munich Re, Swiss Re and Gallagher Re, and the California Department of Insurance's tracker showed $25.2 billion paid on 41,727 claims as of July 6, 2026.
These findings do not contradict each other. A loss-normalization study asks how much of the rise in dollars is explained by more property. An attribution study asks whether the weather itself shifted. Both can be true for the same peril. For a homeowner the distinction matters less than it sounds: insurers price on forward-looking catastrophe model output rather than waiting for the debate to settle, and the price lands on your address either way.
Four ways it reaches your policy
1. The premium
The pricing gap between exposed and unexposed areas is measurable. The U.S. Treasury's Federal Insurance Office analyzed more than 246 million policies from 2018 to 2022 and found that the highest-risk ZIP Codes, the top 20% by expected annual climate-related building losses, paid an average of $2,321 per policy in inflation-adjusted dollars, 82% more than the lowest-risk 20% at $1,277 (FIO report, January 2025). The Government Accountability Office found in GAO-26-107867 that the average premium rose about 3% after inflation from 2019 to 2024, while rates in parts of some states, especially southern coastal areas at high wind risk, rose 25% or more.
2. The terms
Insurers also change what the policy does. Expect percentage hurricane deductible and wind/hail deductibles, depreciated roof payment, cosmetic damage exclusions and age-based tiering. S&P Global Market Intelligence says, in an Insurance Journal report of September 2026, that the slowdown in approved rate increases reflects "non-rate actions" like these, which is why a flat premium can come with worse coverage.
3. Availability
The national nonrenewal rate rose to 1.20% in 2022 from 1.05% in 2018, according to FIO, and in the highest-risk ZIP Codes the five-year average was 1.61%. A December 2024 Senate Budget Committee staff report, built on data from 23 insurers covering about 65% of the market, put Florida's 2023 nonrenewal rate at 2.99%. Its causal framing is the committee's own, but the data are the insurers'. When the private market retreats, FAIR plan counts grow: the California FAIR Plan had 696,562 policies in June 2026, and Florida's Citizens peaked at 1,407,805 in September 2023 before falling to 254,736 by October 2, 2026. See why insurers are pulling out of states.
4. The political response
States are trading rules for commitments. California's Sustainable Insurance Strategy lets insurers use forward-looking wildfire models and include reinsurance costs in rates if they agree to write in distressed areas; see California. Florida's 2022 and 2023 reforms targeted litigation costs. Colorado requires insurers to disclose wildfire score information. Whether these steps lower your premium depends on your state and insurer.
Where each hazard shows up on your policy
| Hazard | What is changing | What it does to your coverage | Read next |
|---|---|---|---|
| Wildfire | Longer fire seasons, more homes near wildland | Address-level scoring, nonrenewal, FAIR Plan fallback | does homeowners insurance cover wildfire? |
| Hurricane and wind | Costlier rebuilds, dense coastal development | Percentage hurricane deductible, wind exclusions, wind pools | hurricane coverage: wind, flood and storm surge |
| Flood and heavy rain | Rainfall far from the coast | Excluded from the HO-3; needs NFIP or private flood | does homeowners insurance cover flooding? |
| Hail and tornado | Large, frequent, mid-size events | Wind/hail deductibles, roof schedules | severe convective storms and rising premiums |
| Heat and drought | Hotter summers, dry soil, grid stress | Mostly indirect: wildfire, foundation and outage losses | extreme heat, drought and your home: what insurance covers |
What to do with this
- Find out which hazards apply to your address. Check the FEMA flood map for your home, ask your insurer or agent about your wildfire score (wildfire risk scores and how insurers use them), and look at your state's wind and hail exposure.
- Read your declarations page for the terms, not just the price. Deductible type, roof settlement basis, excluded perils and wind-only arrangements are where climate pressure shows up first.
- Buy the coverage the policy excludes. Flood is the common gap. The hurricane and wildfire season insurance checklist lists the other perils people discover too late.
- Spend on mitigation that insurers credit. FORTIFIED roofs, defensible space, ember-resistant vents and roof-to-wall connections can lower both risk and premium in some states; ask for the written list of credits before you pay a contractor.
- Check insurability before you buy. A house in a high-risk area can be cheap to buy and hard to insure (check insurability before you buy a house).
- Know the fallback. If you are dropped, your state regulator and its insurer of last resort are the next stop.
Key takeaways
- Climate change affects your policy through claim costs: wildfire, storms, flooding and heat can raise the frequency or severity of losses insurers must price.
- It is not the only driver. Exposure growth, repair costs and reinsurance pricing explain a large share of the premium rise, and researchers disagree on the split.
- The effect is uneven. FIO found premiums 82% higher in the highest climate-risk ZIP Codes, and GAO found the biggest real increases in high-wind coastal areas.
- Expect changes in deductibles, roof terms and availability, not just price, and compare those terms at every renewal.
- You cannot change the climate, but you can check your hazard exposure, close the flood gap and document mitigation work.