Homeowner blindsided after insurance company issues sudden rate hike with no warning: 'I was surprised by the amount'

Homeowners across the country are seeing insurance rates rise, and the reason is out of their control.

What's happening?

Insurance rates are on the rise, and the changing climate is to blame. As extreme weather events become more frequent or more intense (and sometimes both), insurance rates are skyrocketing to account for the growing risk.

Last year, Nebraska and other surrounding states saw several tornadoes resulting in billions of dollars in damage. This year, residents in Omaha are still paying the price — their home insurance rates are rising hundreds of dollars.

"I wasn't surprised that there was an increase. I was surprised by the amount of the increase," North Omaha resident Mary Butler told KETV.

On average, Nebraska residents are paying anywhere from $5,000 to $7,000 annually, per Bankrate data. 

Why is this concerning?

Insurance rates are rapidly becoming unsustainable. According to the U.S. Department of the Treasury, the "average homeowners insurance premiums per policy increased 8.7 percent faster than the rate of inflation in 2018-2022."

Homeowners are presented with a difficult choice: bank-breaking insurance premiums or no disaster coverage.

Some may not even have a choice — homeowners in high-risk regions can be dropped from their insurance plans without warning. Thousands of Californians were dropped from their policies after the wildfires, and North Carolinians lost coverage following Hurricane Helene.

As the effects of the changing climate are felt throughout the country, more and more homeowners are at risk of losing their coverage.

What's being done about this?

Some states are trying to introduce laws that will prevent insurers from canceling policies during times of catastrophe, like wildfires and floods.

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If you're struggling to afford your policy payment, know your options — shop around for insurance policies to find the most protection at the lowest cost.

You can also invest in home upgrades to help protect your home from extreme weather events.

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