As disasters linked to climate change become more frequent in the U.S., homeowners across the country are paying the price through skyrocketing insurance costs — and not only in states like Florida and California that are considered most vulnerable to global warming.
The average homeowners insurance premium jumped 33% from 2020 to 2023, rising from $1,902 per year to $2,530, according to 2024 research from economists at the University of Pennsylvania’s Wharton School and the University of Wisconsin. By comparison, inflation rose about 18% during that same time period.
Such costs have surged even more in parts of the U.S. prone to the kind of natural disasters that experts link to climate change. Homeowners in these states have seen their insurance premiums soar by about 50% over that three-year period, according to Benjamin Keys, a professor real estate and finance at Wharton and a co-author of the 2024 study.
“That is a serious pocketbook issue,” said Wharton’s Keys in a Jan. 10 webcast to discuss the Los Angeles wildfires and insurance, about the rise in policy premiums. “That is the kind of thing that gets you around the kitchen table and say, do we need to move?”
