Homeowners all over the country could soon feel the financial impact of the devastating California wildfires. As insurance companies grapple with the rising costs of natural disasters, they are looking for ways to protect themselves. This could mean raised premiums and reduced coverage for homeowners in states such as Iowa.
Wildfires in California, already a significant challenge for residents there, may have a surprising impact on people across the country. Cedar Rapids' KCRG reported that experts in the Hawkeye State are predicting that the fires could lead to increased homeowners insurance costs. This could be caused by the prevailing practice of reinsurance, wherein insurance companies buy policies to protect themselves from catastrophic losses.
Ed Faber, a Cedar Rapids insurance agent, told KCRG that Iowa's insurance market is the toughest he's seen in 13 years, with companies raising rates and reducing coverage.
Extreme weather events such as wildfires are becoming more severe and frequent because of pollution caused by burning gas, coal, and oil.
This traps heat and directly contributes to Earth's overheating, with the impact not confined to just wildfire-prone areas. KCRG observed that events including Iowa's derecho caused billions of dollars in damages and pushed some insurers to leave the state.
