As insurance rates continue to rise, homeowners across the U.S. are paying the real price.

What's happening?

Homeowners throughout the country are seeing rising homeowners insurance rates, and everyone is shifting the blame.

The Illinois Senate Insurance Committee recently met to discuss the root cause of rising rates, according to The State Journal-Register. Some argued that Illinois homeowners are secretly paying the price for other states' insurance losses, while others cited increased frequency of damage from extreme weather events like hail and tornadoes.

Illinois is yet another example of skyrocketing insurance rates attributed to more frequent extreme weather events — a side effect of climate change. 

Why are rising rates concerning?

Illinois is the only state in the U.S. where "insurance regulators do not have authority to review and either approve, modify, or reject proposed premium changes in the homeowners insurance market," according to The State Journal-Register.

Insurance companies in Illinois can hike rates without state review, and homeowners must choose between making outrageously expensive payments and risking no coverage at all. 

Forgoing coverage may not even be an option — if you have a mortgage, most lenders require homeowners insurance, forcing homeowners to pay the rising rates.

Even with price caps, if insurance companies are unable to pay out claims, such as in the case of severe natural disasters, it could leave homeowners without homes and money.

Nat Shapo, former director of the Illinois Department of Insurance, believes "the greatest harm to policyholders that your constituents is when a carrier can't pay their claims," per The State Journal-Register.

What's being done to prevent high premiums?

Typically, states can regulate insurance companies to prevent them from setting unreasonable rates or increasing costs during times of crisis. Illinois is the exception, and hearings are underway to iron out the many complications. 

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States everywhere can start by addressing one source of the problem: climate change. 

Reducing planet-warming emissions could reduce the frequency and intensity of extreme weather events, thus lowering homeowners' risks and premiums. 

To protect yourself and your residence, weatherize your home.

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