Hurricanes and wildfires are making national headlines. These natural disasters are not only dominating the headlines but are taking a toll on the people in affected areas, as well as the insurance industry as a whole. According to some estimates, the most recent damage caused by Hurricane Ian has caused in excess of $150 Billion in damages, and the concern now is whether this will raise insurance premiums for everyone.

The insurance market is overdue for an upward correction and premium increase. So, for the most of us, it’s a safe bet that house insurance prices will rise slightly, but not much enough to cause a heart attack. Homeowners in certain, but not all, high-risk locations may experience significant premiums or perhaps difficulty obtaining insurance at all. Along with and as a result of the recent disasters, there is increased anxiety about what climate change may bring, which may put more upward pressure on rates in the near future.

Here’s an outline of the pressures and uncertainties that may affect your upcoming insurance budget, as well as some advice on how to deal with any rate increases that may occur. Rate increases are long overdue in the insurance sector. It’s difficult to generalize about insurance premiums because each state has its own regulatory organization, which is commonly referred to as the Department of Insurance. They vary widely in terms of how much influence they have on rates. For example, in fire-ravaged states, insurers must justify increases with evidence. Nonetheless, broad industry pressures have an impact on rates across the country.

The way it’s meant to operate is that insurance companies deposit a little portion of your annual payment toward a reserve for the occasional disaster. They anticipate a cataclysmic year once every ten years, and that reserve will cover it. However, for nearly a decade, those reserves have been insufficient to keep up with calamities. In hard-hit areas, insurers may have to rewrite risk maps. If your neighborhood was recently impacted by a hurricane or fire, it may already be categorized as a high-risk zone, and you may already be paying more. In that instance, you might not notice much of a difference. The risk of wildfires, for example, is already factored into premiums in some areas of California. It’s a different situation in newly impacted places or when things are shifting. In California, ongoing drought and other causes are causing more places to be designated as danger zones. According to the San Francisco Chronicle, an El Dorado County resident surrounded by grasslands had her annual homeowners insurance rate triple over a four years span.

Other parts of the country are experiencing issues as well, because of its history of hurricanes and hailstorms, Texas has long had high house insurance rates. Nonetheless, recent hurricanes impact was devastating, due to bringing much of the water occurring outside of regular flood zones. The insurance business normally follows official flood maps, although they can develop and create their own maps as well. There is precedent for insurance firms revisiting what they identify as high-risk locations after a significant incident occurs. People who were formerly regarded to be outside of a flood zone may suddenly be included in one, necessitating the purchase of extra insurance.” However, as we previously stated, there is a potential that competition will put a stop to this type of growth. Following Hurricane Sandy, several insurance firms attempted to limit windstorm coverage all the way up to Maine, while others refused to force their clients to get additional coverage. Some homeowners may be unable to obtain insurance at all. Insurers are known to withdraw from high-risk markets. If this happens to you, contact your state’s insurance department. Some states have a last resort program that will provide you with basic coverage.