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insurance
Helene's Catastrophic Potential Stokes Fear Amid Florida Insurance Crisis
Florida already has one of the nation's largest shares of homeowners "who don't have meaningful insurance."
Sep 26, 2024
Hurricane Helene continued barreling toward Florida on Thursday, highlighting the impacts of the fossil fuel-driven climate emergency, including difficulties securing insurance coverage in regions most affected by extreme weather.
"The Air Force Hurricane Hunters found that the maximum sustained winds have increased to near 120 mph," the National Hurricane Center said Thursday afternoon. "This makes Helene a dangerous Category 3 major hurricane. Additional strengthening is expected before Helene makes landfall in the Florida Big Bend this evening."
Federal Emergency Management Agency Administrator Deanne Criswell said during a White House briefing that forecasts suggest Helene will make a "dead-on hit to Tallahassee" and "this is going to be a multistate event with the potential for significant impacts from Florida all the way to Tennessee."
Although this Atlantic hurricane season hasn't yet been as intense as U.S. scientists expected, trends in extreme weather disasters have led some insurance companies to exit the Florida market in recent years. Farmers Insurance announced last year that it would stop covering property in the state, in an effort to "effectively manage risk exposure."
While the Insurance Information Institute, an industry trade group, said in May that "legislative reforms passed in 2022 and 2023 have created a pathway to a stable Florida market," reporting from this week shows that residents—who aren't ultrarich—are still struggling to get and keep coverage.
"Florida ranks sixth among states with the largest shares of homeowners who don't have meaningful insurance. About 18% of homeowners across the state—about 1 in 6—are without it," NBC Newsnoted Wednesday. "Nearly 20% of Florida homeowners pay $4,000 or more a year for homeowners insurance—the largest share in the country, according to the Census Bureau."
According toThe Palm Beach Post, the global reinsurance broker Gallagher Re said in a Wednesday analysis that "landfall in the Big Bend or Panhandle region of Florida as a major hurricane (Category 3, 4, or 5) has historically translated to insured losses in the low single-digit billions."
"But Helene is not a typical storm," the firm explained. "Given Helene's very large wind radius, this would still bring hurricane-force wind gusts and high storm surge to coastal areas in the heavily populated Tampa Bay area, tropical storm force winds across most of the Florida peninsula, Georgia, the Carolinas, Tennessee, and southern Appalachia."
Gallagher Re suggested that "Helene's private insurance market losses should be expected to land in the range" of $3 billion to $6 billion, but if the hurricane "unexpectedly" moves toward Tampa, it could be over $10 billion.
Florida isn't the only state facing insurance trouble thanks to climate chaos. Voxreported last year that "insuring property in California has been a dicey proposition," pointing to torrential rainfall that "caused as much as $1.5 billion in insured losses" and "the costliest wildfires in U.S. history, including the 2018 Camp Fire, which led to more than $10 billion in losses."
Amid the intertwined climate and insurance crises, scientists, campaigners, and homeowners have demanded policy action—and elevated criticism of right-wing attacks on crucial programs.
In a June blog post, Rachel Cleetus, policy director with the Union of Concerned Scientists' Climate and Energy program, wrote that "Congress and regulators need to ensure more transparency in the insurance market on how companies are evaluating risks as they make decisions about premiums. There also needs to be better information on what kinds of incentives companies are providing for adaptation measures that would help reduce risks."
"Alongside the necessary but ultimately bounded role of insurance in a warming world, public and private decision-makers must also shift investments away from business-as-usual maladaptive and risky choices to more resilient ones," Cleetus continued. "The nation must scale up resources for climate resilience and ensure they are reaching communities in a just and equitable way. Funding for safe, affordable, and climate-resilient housing must be expanded."
The Climate & Community Institute on Wednesday also shared recommendations in a new report—Shared Fates: A Housing Resilience Policy Vision for the Home Insurance Crisis—using case studies from California, Florida, and Minnesota.
"We propose the creation of Housing Resilience Agencies (HRAs), either by states or the federal government," the institute said. These agencies would:
- Provide public disaster insurance that offers fair and equitable protections;
- Coordinate and oversee comprehensive, community-oriented disaster risk reduction;
- Address existing market failures by providing coverage for oft-neglected sectors such as multifamily housing providers, mobile home dwellers, and heirs properties; and
- Host public risk models, climate risk advisory councils, and diverse governing boards to inform decision-making in a transparent and democratic manner.
"In order to confront the growing housing safety and affordability crisis, we need to understand our fates as shared," the institute added. "We must reimagine our home insurance system for it to reduce risk and provide equitable and fair protection."
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What the Inflation Reduction Act Has Meant for Healthcare 2 Years Later
From the $35 insulin co-pay to capping insurance premium costs, the legislation has been health-changing and life-changing.
Aug 30, 2024
I was honored to be at the White House this month for the Inflation Reduction Act anniversary event, featuring Americans sharing their stories of saving money and saving lives.
Thank you to the millions of people fighting every day for lower drug prices, to Congress for passing the Inflation Reduction Act, U.S. Vice President Kamala Harris for casting the deciding vote in the Senate, and President Joe Biden for signing it into law.
Meet Bob Parant, from New York. He’s a 71-year-old man who has been living with type 1 diabetes for over fifty years. He lost his leg in 2010, and became eligible for Medicare. Before the Inflation Reduction Act, the last price Bob paid for a vial of insulin was $580, which was “horrendous.”
We have made so much progress on healthcare. But as everyone reading this knows, there is so much more to do.
Listen to Pam Parker, from Maryland: She’s a retired electrician, 62 years old, and has been diabetic since she was 30. “I had to decide, a lot of months, between mortgage, groceries, utilities, and other things… I would juggle my expenses, and really juggle my healthcare.. I would eat less, or ration my insulin to make it last.. I had high blood pressure, I fell into a coma, my kidneys failed… they told me I coded.”
Learn from Robin Craycroft, from Missouri: When she turned 65 and had access to Medicare, the pharmacist told her that one insulin for three months was $3,000. “Everything that we had planned, cancelled, and our life just changed. And I felt such guilt over that… We’re gonna spend $2,000 a month (two insulin vials) to keep me alive. You start going through, am I worth it? Should I do that to [my husband]?”
Hear Steven Hadfield, from North Carolina: “Before the $35 cap, sometimes you had to skip a dose, sometimes you had to not test yourself, watch what you eat because you couldn’t afford it…”
The $35 insulin co-pay cap for people on Medicare is just one of the health-changing and life-changing parts of the Inflation Reduction Act.
This year, people on Medicare have their out of pocket Part D drug costs capped at around $3,500. And next year, the maximum drops down to $2,000. This means seniors on a fixed income won’t have to choose medicine over food or housing or anything else. Also recommended adult vaccines such as the new shingles vaccine are now free for Medicare recipients.
Pharmaceutical companies that raise their prices higher than inflation are required to pay Medicare a rebate, to encourage them to stop price gouging patients. And in 2026, price negotiations for the first 10 drugs under Medicare go into effect: lowering the costs of those drugs for millions of Americans. The savings will continue for patients and taxpayers as more drug prices are negotiated each year.
But the Inflation Reduction Act doesn’t just help people on Medicare. Over 21 million Americans like me get their health insurance through the Affordable Care Act marketplaces. When I was diagnosed with stage 4 cancer in 2017, I did not qualify for financial help for insurance. Thankfully I was able to afford a plan anyway, and to pay the maximum deductible for that year. A bargain compared to the over half a million dollars it cost to save my life.
I am so grateful to still be here, and for the Affordable Care Act made truly more affordable to millions of working Americans like me.
The American Rescue Plan, and then the Inflation Reduction Act, provided financial help for health insurance to many more who needed it. This law caps the cost of premiums at no more than 8.5% of your income, meaning people—especially older folks who face higher premiums, or people in more expensive healthcare markets—don’t get penalized, and can still afford the care they need.
We have made so much progress on healthcare. But as everyone reading this knows, there is so much more to do.
First, we have to defend the advances in the Inflation Reduction Act. A new administration and a new Congress next year means everything we’ve gained could be on the chopping block.
Second, the health insurance tax credits piece expires in 2025. Without that renewal, millions of Americans would go back to being priced out of health insurance.
Third, the Medicare provisions such as the $35 insulin cap, the drug price negotiation, and more, need to be expanded to everyone.
We are grateful to still be here, and to keep fighting until every American can get the healthcare they need. We cannot go back.
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Mega-Rich Are Paying $600,000+ a Year to Insure Their Mansions Against Climate Disaster
"The growing insurance crisis illustrates the vital importance of seeing climate change as a risk to the entire financial system," said one watchdog group.
Sep 08, 2023
With extreme weather disasters increasing in frequency and intensity as the global climate crisis rages, wealthy homeowners in some coastal areas of the United States are paying six figures a year to insure their houses against flooding and other impacts of the kind that Hurricane Idalia brought to Florida last week.
Bloomberg's Felipe Marques and Devon Pendleton reported Thursday that the owner of a $50 million mansion on Florida's Star Island was given a $622,000-per-year quote for home insurance.
"Granted, that was a recent quote for a policy on one of the ultraluxe mansions on the Biscayne Bay island, where A-listers like Rick Ross, Ken Griffin, and Alex Rodriguez own homes. But, only last year, the same policy cost $200,000," Marques and Pendleton wrote. "Even for the moderately wealthy, insurance costs are beginning to verge on unaffordable: The cost of so-called high-value insurance, loosely defined as policies covering homes worth more than $1 million, is outpacing the rise in premiums for more modestly valued homes by anywhere from two to 70-fold."
Surging home insurance premiums for the rich underscore a broader crisis that is disproportionately impacting regular homeowners who live in areas particularly vulnerable to climate chaos.
"Insurance premiums are soaring as climate risk grows, pricing everyone but the wealthy out of some coastal areas," Marques and Pendleton wrote. "Even before Hurricane Idalia hit Florida's Gulf Coast last week, leaving a trail of destruction in its wake, tens of thousands of ordinary Floridians were struggling to find affordable policies."
This year alone, the U.S. has seen a record 15 extreme weather disasters that caused damage exceeding $1 billion, a number that scientists say is likely to increase unless urgent action is taken to phase out fossil fuels.
"They've underwritten financing fossil fuels, and then they profit from selling protection from the impacts of those fossil fuels on climate."
With climate risks growing exponentially, major insurers have jacked up rates, restricted coverage in disaster-prone areas, and even withdrawn entirely from states.
"At least five large U.S. property insurers—including Allstate, American Family, Nationwide, Erie Insurance Group, and Berkshire Hathaway—have told regulators that extreme weather patterns caused by climate change have led them to stop writing coverages in some regions, exclude protections from various weather events, and raise monthly premiums and deductibles," The Washington Postreported earlier this week.
Farmers Insurance, one of the nation's largest home insurance providers, announced in July that it would no longer cover properties in Florida. The move followed State Farm's decision in May to stop selling homeowners' insurance in California.
"Wildfires, hurricanes, thunderstorms, and flash floods have wreaked havoc across the U.S. this year, and after each disaster, homeowners have looked to their insurance providers to defray their losses," Carly Fabian, insurance policy advocate with Public Citizen's Climate Team, said Thursday. "More and more often, those companies have packed up and moved on, leaving homeowners fewer and fewer options for insurance."
"The growing insurance crisis illustrates the vital importance of seeing climate change as a risk to the entire financial system," Fabian added. "Year after year, disasters with multi-billion dollar price tags have struck around the globe."
The industry's response to escalating climate risk has drawn greater attention to insurers' role in fueling the crisis.
Last month, Sens. Sheldon Whitehouse (D-R.I.), Ron Wyden (D-Ore.), and Bernie Sanders (I-Vt.) noted in a letter to insurance giants that "U.S. insurers currently have approximately $582 billion invested in fossil fuels—with nearly $90 billion in coal alone."
"U.S. insurers continue to underwrite polluting projects while making investments in an industry whose continued expansion poses multiple serious dangers to overall economic stability and to insurance services in particular," the senators wrote.
During a Senate Banking Committee hearing on Thursday, Sen. Elizabeth Warren (D-Mass.) said that insurance companies "have kind of been playing every part of this game."
"They've underwritten financing fossil fuels, and then they profit from selling protection from the impacts of those fossil fuels on climate. Now when climate risks are rising, they're trying to hang American families out to dry."
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