Texas could stress test property insurance
The U.S. is experiencing a significant homeowners insurance crisis, due to escalating climate-related disasters such as wildfires and hurricanes, which have led major insurers like State Farm and Farmers Insurance to withdraw from high-risk areas. Many homeowners in states like California and Florida are facing soaring premiums or losing coverage entirely, forcing them to rely on state-run programs that often offer limited protection at higher costs. Experts warn that this growing “protection gap” could leave homeowners financially vulnerable in the event of future disasters, highlighting the urgent need for comprehensive policy reforms and increased insurer participation.
According to Cotality, “Although the states are taking different approaches, both aim to create a more attractive market for insurers and are intended to provide more affordable options for property-owning residents. The intent is to help prevent reliance on state insurers of last resort — government-backed programs that typically offer less comprehensive coverage at a higher cost.”
