As climate change makes extreme weather more common, more people are experiencing damage to their homes and property.

That’s what insurance is for, right? People certainly file insurance claims.

In 2020, nearly 40% of all insurance claims were for weather-related damage, according to a new report from LexisNexis Risk Solutions. This is the highest percentage since the company started producing this assurance report six years ago.

The total amount insurers had to pay for weather-related losses also increased last year.

The more severe the storms, fires and floods, the more people will face damaged roofs and basements.

“And that means consumers need the protection of insurance more than ever,” said Carolyn Kousky of the Wharton Risk Management and Decision Processes Center at the University of Pennsylvania. But the problem is, “those same trends make it harder for insurers to offer coverage, or to offer it at a price that people can afford,” she said.

Large natural disasters have always been a challenge for insurance companies, Kousky said, “because when these events happen, so many people are affected at the same time, and the losses can be so severe that they really have to be. the potential to bankrupt a business “.

But now you don’t just see these kinds of events happening more frequently, “you see more and more people moving to these high-risk areas,” said George Hosfield of LexisNexis Risk Solutions, who provides data. and analyzes for the insurance industry.

That’s because many high-risk areas – like California and the Atlantic coast – are attractive places to live, he said. But these places might become less attractive in the future when homeowners ogle their insurance bills.

“Insurance prices in these areas, I think, can only continue to rise, and in some cases significantly,” Hosfield said.

Already, “people are paying more for their insurance but getting less protection,” said Amy Bach of consumer organization United Policyholders.

In areas prone to fires and hurricanes, many insurance companies have increased deductibles and limited the amount they will cover.

“Which means we are seeing more blue tarps, you know, unrepaired roofs, as a result of storms we are seeing people taking on more debt because they have to find ways to pay for repairs that insurers don’t cover. “said Bach. noted.

And she said that means more people have to rely on the Federal Emergency Management Agency and other government aid to try to rebuild.