For anyone who has home, renters or car insurance, it’s no secret rates are going up. According to Policygenius, 94% of homeowners were charged a higher premium at renewal between May 2021 and May 2022.  

Prices are not only higher – they are a lot higher. Home insurance rates rose 35% from 2021 to 2022. Some states are impacted more than others: In Florida rates rose 68%, in New Mexico they rose 47%, and in Colorado, Iowa, and Texas they rose 46%.  

You don’t need to be a homeowner to be impacted. Where property insurance goes up, so too does the cost of rent – landlords simply fold additional insurance costs into monthly rents. These costs are not typically disclosed to tenants. 

Reasons to get insurance

Property insurance began as mutual aid. Everyone in a community paid into a fund; then the fund was used to help a neighbor rebuild or replace if their home or car was damaged by fire, burglary, or something else.  

Many local and regional insurance companies still operate this way, and you can find them in Green America’s Climate Smart Insurance Directory.  

But why have home, renters, and car insurance in the first place? 

The law requires it. Most states require that anyone with a driver’s license have car insurance on any vehicle they drive – including if they are driving someone else’s car. 

Mortgages require it. Banks will not lend money for people to mortgage a home or other property without proof of insurance – otherwise if disaster strikes, the bank could be left holding the bag.  

Protect your investment. For most people, owning a home is their single largest financial asset. Without insurance, one hurricane, one tornado, one fire could destroy everything you have worked for and render you homeless.  

Protect yourself. If you rent, you are physically connected to what everyone around you is doing. If a neighbor starts a fire that damages or destroys your property, renters insurance can help pay to replace it and house you until you find a new place to live.  

Pay the bills. If you, your family members, or your pets are injured or cause damage or injury to someone else, insurance can help pay legal and medical costs.  

Affording insurance

These rising costs make it harder for people to pay for home insurance. Increasingly, more and more people are going without insurance – what the industry calls “going bare.”  

A report by the Consumer Federation of America found that over 6 million homeowners have no insurance, leaving them unprotected from natural or manmade disasters that could significantly damage or destroy their homes.  

This adds up to $1.6 trillion in unprotected property values. Most affected are Black and Hispanic homeowners, low-income owners, and people in manufactured homes.  

But there are steps you can take to afford property insurance:

• Get quotes from at least three local and regional insurance companies in your area

• Bundle your home or renters insurance with your car insurance

• Pay in monthly installments instead of all at once

• Ask for any discounts, such as through AAA or for a good driving record

Going without insurance is a very costly accident waiting to happen – especially in an era of increasing impacts from the climate crisis.  

Learn more on the following pages about how climate change is affecting property insurance, how to shop for insurance, and what to do if your policy is canceled.