A flooded street in Houston, Texas following Hurricane Harvey. It represents the homeowners insurance is hard to buy.

States Look Into Why Homeowners Insurance is Hard to Buy

State regulators around the country want detailed data from over 400 insurance companies regarding their homeowner policies. Regulators are aiming to address accessibility and affordability concerns as premiums continue rising.

Why it matters: Homeowners nationwide are struggling to obtain and retain coverage. Economic inflation and increasingly severe weather are significant reasons. Major insurers have withdrawn from high-risk areas like Florida and California.

The National Association of Insurance Commissioners (NAIC) initiative reflects a broader trend of regulatory efforts to understand and mitigate homeowner’s insurance market challenges, particularly regarding climate-related risks.

  • Andrew N. Mais, NAIC President and Connecticut Insurance Commissioner, said in a statement that the request hopes to address the critical challenges homeowners face “and the financial health of insurance companies.”

What they’re saying: “The most pressing need at this time is to help communities adapt to climate-related risks and make sure they are adequately insured against events that can’t be prevented,” Mark Friedlander, a spokesman for the insurance industry trade group, the Insurance Information Institute told the New York Times.

Digging in: Regulators expect to analyze data from about 80% of all homeowners’ plans. Key areas they want to look at include total insurance premiums, coverage types, claims history, and discounts across different regions.

Insurers are expected to share information about the opportunities for discounts that customers can get by fixing or upgrading parts of their homes.

What’s next: The companies’ responses are due by early June, and they must comply or risk fines.

Photo: A flooded street in Houston, Texas, following Hurricane Harvey, which caused catastrophic flooding in 2017. (Shutterstock)