The United States suffered over $56 Billion in property damage in 2021, impacting 1 in every 10 homes across the country. This was according to the 2021 Climate Change Catastrophe Report compiled by CoreLogic®, a leading data and property analytics firm.
Download the 2021 Climate Change Catastrophe Report by CoreLogic®
https://clymwealth.com/wp-content/uploads/2022/02/CL_CAT-Report-infograph_B5-R-1.pdf
As more insurance companies are impacted by these huge financial payouts, homeowners need to pay close attention to the financial strength of the insurance companies and the small print in their hazard insurance policies. Insurance companies will continue to try to mitigate the risks of natural disasters by writing restrictions and limitations on coverage into policies, putting homeowners on the hook for more and more scenarios that used to be covered.
Ways to Protect Your Property
- Go through the policy coverage and limitations thoroughly with your agent or an insurance expert. Is your coverage adequate to replace your home in the event of a catastrophic loss? Has the value of your home increased through appreciation or improvements?
- Investigate the finances of your insurance company. Some of the largest insurance companies have stopped writing in risky geographic regions, leaving only smaller, under-capitalized insurance companies to write policies in some areas. These smaller companies may have much cheaper rates, but they may not be capitalized enough to pay all of the claims in a severe disaster.
- Specifically ask your agent to explain any decreases in coverage. This will make sure you understand any increased risks that may not be clear.