Many things in life cost more over time. Most things anyway. If you are of a certain age, you remember the cost of a handheld calculator being very expensive—they were a product of new technology. What were once $80 or more became just a few dollars in a matter of five years or so. The same thing happened with early desktop computers. Things that are not based on new technology, however, like a loaf of bread, a pair of shoes, a refrigerator, a home, typically will get more expensive as years go by.
There has been a lot of talk over the last two or three years about the rate of inflation. Finger pointing and blame; explanations referring to supply chain issues, burdensome regulations, and price gauging by corporations taking advantage of consumers. There is some truth to all these factors. What is not discussed much is the impact of climate change on the cost of insurance.

As the changing climate produces more weather disasters there are more insurance claims filed, increasing costs for insurers, resulting in more expensive premiums. There is little to support that this is just coincidence—and the costs are steep.

In 2023, there were 28 weather and climate disasters that cost at least $1 billion, according to the NOAA National Centers for Environmental Information. The 2023 numbers beat the previous record of 22 disasters in 2020. According to a September 2024 article from the car insurance industry, “These billion-dollar events came in a variety of forms including wildfires, floods, tornadoes and a shocking 17 severe hail events. Hail and flooding can do massive damage to vehicles and push up the cost of claims, leading to higher premiums for everyone.” The Insurance Industry Institute reported that on average their insurers paid out $1.10 for every $1 collected in premiums in 2023—a clear driver of increased insurance premiums for our cars.

There are now some states where insurers have concluded the risk is too great and are choosing not to offer insurance at all, worsening the situation. For more details related to the cost of insurance due to climate change start with the links below.

https://www.carinsurance.com/trends-and-insights/climate-change-impact-on-auto-insurance-industry/
https://insideclimatenews.org/news/29102024/todays-climate-extreme-weather-car-insurance/