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AMES, Iowa -- Inflation and costly natural disasters are catching the blame for recent big jumps in home insurance premiums.
"In each of the last three years, the average has been roughly $90 billion of damages. The average for the previous decade was around $40 billion. It has become much more costly it insure," says Iowa State University Economics professor Peter Orazem.
The August, 2020 derecho that swept across Iowa and four other Midwest states is still the costliest storm of it's kind on U.S. history, causing more than $11 billion in damage.
He says insurance companies no longer willing to write home policies in states more prone to natural disasters like hurricanes and wildfires.
"Homeowner insurance has lost money six of the last seven years, and insurance companies stock performance is lagging the rest of the financial sector, writ broad," Orazem says.
He also says some insurance companies will also no longer write policies in states like California, where state law limits premium increases.
Orazem says Iowa's home insurance premiums have gone up 10- to 15-percent, 20 percent in Nebraska, and 30-percent in Illinois.