Skyrocketing home insurance rates, loss of coverage roil Colorado’s strained housing market
Is Colorado's Housing Market at Risk Due to Soaring Insurance Rates?
Colorado's housing market is experiencing significant strain due to skyrocketing home insurance rates, with premiums increasing by 30% to over 130% in recent years. Homeowners face non-renewals and the challenge of finding new insurers willing to take on the risk, particularly in wildfire-prone areas.
The rise in insurance costs is driven by factors such as inflation, higher costs of building materials and labor, and an increase in natural disasters like wildfires and hail storms. This situation is exacerbated by a tightening reinsurance market, where global companies are reassessing their risks due to climate change impacts.
The situation has led to increased financial pressure on homeowners and the real estate market, with some unable to secure insurance at all. Colorado is implementing measures like creating an insurer of last resort to help stabilize the market, but challenges persist with the ongoing threat of natural disasters and rising insurance premiums.