Home insurance rates spike in the tri-state area due to climate change
MAMARONECK, N.Y. (PIX11) -- Some homeowners in the tri-state area have seen their insurance bills spike this year, and because the trend appears to be continuing, new measures are being called for to try and control rates of increase. Natural disasters that have been intensified by climate change appear to be the culprit.
Homeowner Robin Kuras sums up a prevailing mood.
"It is concerning," she said, in front of her home. "It's possible anything can happen."
Even though she also said that the rates she currently pays for insurance are manageable, reported rates in the tri-state region validate her concerns about what the future holds.
An increase in natural disasters fueled by climate change in recent years, such as wildfires in the American West, and flooding and other severe weather in our region, has caused insurers to increase rates here, in some cases drastically.
A detailed analysis from S&P Global Market Intelligence shows a significant cumulative increase in homeowners' insurance since 2018 throughout the tri-state area. The spike is 19% in New York; 15.4% in New Jersey; and 23.4% in Connecticut.
Those figures are for 2023, compiled just under a year ago, and those increases are average amounts. In other words, while some homeowners' rates have gone up moderately, some other residents' rates, especially in multi-unit condos and co-ops, have increased by as much as 300%. When the 2024 year-end analysis is completed later this month, the rates are expected to rise even more dramatically.
In neighborhoods between the tidal waters of Long Island Sound and I-95 in New York coastal communities like New Rochelle, Mamaroneck, Larchmont, and Rye, some insurers have designated those areas coastal flood plains, according to some local residents. They complain that even though many of the homes in the neighborhoods are on hills well above sea level, they're having to buy insurance to protect against low lying area floods, at rates that have risen significantly in recent months.
Another related issue was mentioned by Gail Schaffer, a homeowner in a neighborhood in an area designated a coastal flood plain.
"I'm scared to death," she said in an interview, "because I have a new washer and dryer, because during [a previous] flood, the other ones floated out the door when I opened the door."
Her concern is exacerbated by the fact that her insurer dropped her flood insurance policy, and she can't find any other insurance company that will take her on.
"I can't move," she said. "I've been here too long, so I'm stuck."
New York State Assemblyman David Weprin chairs the assembly's insurance committee.
He said that natural disasters that have increased in number and intensity have put the state in a position where it has to be vigilant against some insurers.
"I'm afraid that insurance companies," he said, "that do business here, as well as in California and other parts of the country where there's more of a problem," the assemblyman continued, "that they will be raising premiums in New York to compensate for losses in other parts."
Weprin said that he's working on the issue with New York's Department of Financial Services, the agency that regulates insurance companies.
DFS is also where people concerned about skyrocketing costs can file complaints. They can do so at a dedicated page on the DFS website.
Weprin has gotten legislation to get greater scrutiny of insurers in New York State passed in both houses of the state legislature, only to have them vetoed by Gov. Kathy Hochul.
As a new legislative term begins this month, Weprin said that he's convinced that strong scrutiny is in place over insurance practices, but he's willing to use all available options.
"We might have to do some legislation in that area," he said.