Breanne Deppisch writes for the Washington Examiner about an underreported challenge facing the home insurance industry.

The U.S. home insurance market is careening toward disaster as policy premiums soar and private insurers exit high-risk states, threatening to affect millions of homeowners nationwide.

In the last 12 months, major insurance providers in California and Florida have either exited the states completely or announced plans to drastically pare down their coverage, citing exposed risk to natural disasters such as wildfires, hurricanes, and floods, and, in California’s case, a challenging reinsurance market. But experts say the two states are just a microcosm of a problem that’s beginning to play out nationally as natural disaster losses rise and put millions more people at risk.

Speaking before Senate lawmakers last month, the American Property Casualty Insurance Association’s vice president of government relations, Nat Wienecke, said the uptick in natural disaster losses has pushed up the cost of property insurance in many parts of the United States, forcing some insurers to rebalance their risk and reduce their exposure, including by raising premiums or pulling out of higher-risk states altogether.

“Reducing our risk must continue to be a shared priority among us all, and we must work together to adapt and increase our resilience in the face of climate-fueled disasters,” she said.

In California, nonrenewal of home insurance policies spiked by a whopping 30% in 2021 compared to the previous year, according to the most recent data from the California Department of Insurance. In Florida, meanwhile, homeowners are shelling out insurance premiums four times as high as other states amid a mass exodus of at least six major property insurers in the last two years.

As a result, many policyholders have been driven into the arms of so-called insurance of last resort, or state-run insurance programs designed to protect individuals considered too high-risk to obtain private coverage.