“This has been the canary in the climate coalmine, and it’s now hitting households’ pocketbooks,” said Ben Keys, an economist at the University of Pennsylvania’s Wharton School and co-author of the research. “You can deny climate change for whatever motivations you have but when insurance is going up because you live in a risky area, that’s hard to deny.”
Keys said there is a “tight correlation” between premium rises and counties deemed most at risk from a metric drawn from past disasters combined with modeling of future events exacerbated by the climate crisis.
Heightened disaster risk now results in a $500 jump in premiums, on average, for households, Keys’s paper finds. People looking for home insurance, required for a mortgage, are now facing tangible climate costs even before they have to pay out for flooding cover, which is typically separate from home policies.
“The cost of living in harm’s way has gone up disproportionately,” said Keys. “We are seeing the first broad-based direct cost of climate change for homeowners because of these insurance increases.”
