A recent report from the U.S. Government Accountability Office (GAO) finds that while homeowners insurance premiums have generally tracked inflation nationwide, costs have risen sharply faster in regions exposed to increasing climate risk.
The report, Homeowners Insurance: Premiums Generally Tracked Inflation but Rose More in Disaster-Prone Areas, underscores a growing divide in affordability and availability driven by hurricanes, flooding, wildfires, and other extreme weather events.
From 2019 to 2024, the average U.S. homeowners insurance premium increased by about 3% after adjusting for inflation. However, the GAO found that in high-risk regions — particularly southern coastal states — premium growth was far more pronounced. In areas of Florida, Louisiana and Oklahoma, rates rose 25% or more, with some localized increases exceeding 50% and even 100% in parts of North Carolina and Texas.
The report links these increases directly to escalating climate risk. "The sharpest increases are concentrated in areas facing more frequent and severe weather events," the GAO notes, pointing to hurricanes, flooding, and wildfires that are no longer rare occurrences but recurring threats. Insurers, facing higher losses, are increasingly passing those costs on to homeowners — or withdrawing coverage entirely in the most vulnerable markets
The affordability strain is significant.
Premiums as a share of median household income are highest in Florida, Louisiana and Oklahoma, where insurance costs are becoming a growing burden on already stretched households. The GAO also found that different types of climate risk affect premiums unevenly. Homes in high wind-risk areas, for example, face premiums roughly 58% higher than comparable properties in lower-risk zones, while high wildfire risk increases premiums by about 8%.
Beyond pricing, availability is also becoming a concern. In some states, insurers of last resort are seeing increased demand as private carriers reduce exposure in high-risk regions. Regulatory frameworks vary widely by state, further shaping access to coverage. In California and Colorado, for instance, median approval times for premium changes exceed 300 days, which can slow insurer responsiveness and contribute to market tightening.
The GAO report emphasizes that insurance is state-regulated, meaning policy responses differ significantly across jurisdictions. Some states are experimenting with reforms aimed at improving both affordability and resilience. However, stakeholders surveyed by GAO — including insurers, regulators, and consumer advocates — expressed the strongest support for policies that incentivize risk mitigation, such as tax credits or deductions for home improvements that reduce disaster vulnerability.
Other federal policy options, including direct insurance or reinsurance programs, received mixed support due to concerns about cost and potential market distortion.
Ultimately, the GAO concludes that rising insurance costs are closely tied to worsening climate risk and that without intervention, affordability and availability will continue to erode in the most vulnerable regions. As natural disasters grow more frequent and severe, homeowners are increasingly bearing the financial consequences — raising broader concerns about housing stability and economic resilience.
Maura Keller is a Minnesota-based freelance writer and editor.
(Featured image: Thousands of people attend the People's Climate March to stand up against climate change in Washington, D.C., in April 2017. Nicole S Glass/Shutterstock)
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.