Senate Questions Insurers on Disaster Claims and Soaring Premiums
Washington, D.C., May 2025 — U.S. Senators are putting insurance companies under the spotlight, raising tough questions about how claims are handled after natural disasters and why premiums are skyrocketing across the country. The hearing reflects growing concern about the insurance industry’s role in the face of more frequent and intense weather events.
Rising Costs for Homeowners
During the Senate hearing, lawmakers pointed out that homeowners in disaster-prone areas—especially along the Gulf Coast and in wildfire zones—are seeing sharp increases in insurance costs. In some cases, premiums have tripled over the past few years. For example, homeowners in Florida now pay more than $6,000 per year on average, significantly higher than the national average.
Testimonies from policyholders highlighted how these costs are creating financial strain. One elderly homeowner from North Carolina said her insurance premium nearly equals her monthly Social Security check. Another from Texas described yearly premium hikes despite raising his deductible and reducing coverage.
Insurers Leaving High-Risk Areas
A major concern raised in the hearing was the growing number of insurers pulling out of high-risk states altogether. Since 2022, more than a dozen companies have exited Florida’s insurance market. This trend has forced many homeowners to rely on state-run insurance programs, which lawmakers fear may not be financially stable in the event of a major disaster.
Experts told the Senate that the number of people being dropped by their insurers has also doubled, making it even harder for families to protect their homes.
Lawmakers Demand Fairer Claims Process
Senators also called out questionable claims practices. Reports suggest some insurance companies have slashed damage estimates by large amounts—sometimes by 90%—after initial inspections. Lawmakers warned that this could lead to delays, underpayments, and legal disputes, leaving homeowners in limbo after a disaster.
They urged insurers to be more transparent and fair in how they process claims, especially when families are recovering from hurricanes, wildfires, or floods.
Looking Ahead
Senators made it clear that they want action. Some called for tighter regulations and stronger oversight to ensure insurance companies don’t take advantage of vulnerable homeowners. Others stressed the need for federal solutions to support both insurers and policyholders as climate risks grow.
As the climate crisis continues, lawmakers are expected to keep a close eye on the insurance industry—and push for reforms to protect Americans facing an uncertain future.
