Homeowners devastated after major insurers hike rates due to weather changes: 'A lot of people are denied coverage'

Oklahoma homeowners have been hit with higher insurance rates as the combination of more severe storms and inflation takes its toll. 

What's happening?

KOCO 5 News reported that severe storms producing tornadoes and hail have increased in the past few years, leading to more damage and surging home insurance rates. 

Oklahoma Insurance Commissioner Glen Mulready explained that costs for a new roof rose by 30% over 18 months due to the intense storms. He said that the top 20 home insurance companies "paid out about $105 for every $100 they took in" for hail, wind, and tornado damage by the end of 2023.

While the recently passed Strengthen Oklahoma Homes Act — which provides grants to homeowners to reinforce their homes against strong windstorms — is designed to lower insurance costs, KOCO 5 News noted that some insurance companies have already requested premium increases. That means homeowners could face rate increases even if they haven't experienced storm damage.

Mulready said rates are increasing by about 10% on average, which isn't a huge jump. However, Bryce Johnson, an attorney from Johnson and Biscone Law Firm, said that insurance providers may deny coverage if they are unwilling to take on the risk. 

"A lot of people are denied coverage, where the insurance company comes in and tries to say the loss is not related to the recent storm," Johnson said, per KOCO 5 News. "They can't drop a homeowner after the claim is made, but they can certainly drop a homeowner before they have any damage to their home. Unfortunately, insurance companies in Oklahoma have been known to do that."

Why are rising insurance rates concerning?

Mulready explained that impact-resistant shingles and tougher roofs could make a difference in terms of storm damage, but they won't protect homeowners from higher insurance rates or a lack of coverage. 

Soaring insurance rates make it harder for families to afford other necessities, and potential buyers may find it more challenging to buy a home. Not having insurance leaves homeowners vulnerable to storm damage and puts the burden of repairs entirely on their shoulders. 

Higher insurance rates lead to market instability as homeowners struggle to afford payments in high-risk areas. A major factor behind increasingly volatile insurance rates is the warming climate fueled by the burning of dirty energy sources, which leads to more extreme weather and costlier storm damage. 

Skyrocketing insurance rates affect homeowners nationwide, including those in weather-battered states such as Florida, Louisiana, and California. Several insurers have dropped policies in Texas and Florida, signaling a worrying trend, as these states are among the hardest hit by hurricanes and floods. 

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What's being done to help?

In California, lawmakers have issued a mandate requiring insurers to increase coverage in wildfire-prone areas, and Massachusetts legislators are expanding flood insurance coverage to protect homeowners from rising sea levels. 

Since the insurance crisis is mainly caused by excess planet-warming pollution in the atmosphere, you can help by upgrading to energy-efficient appliances or installing solar panels, which reduce reliance on the electric grid that is powered mostly by dirty fuels. As more people switch to clean energy, the climate will become more stable, which will help make insurance affordable again. 

You can also check with your state to see if it offers grants to fortify your home against storms. Oklahoma, Alabama, Florida, and Louisiana are several states that provide grants for wind-resistant roofs. 

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