American insurance companies are propping up the oil and gas industry even as climate catastrophes cause coverage premiums to soar.
What's happening?
As Capital & Main detailed, Eddie LeJuine has been fishing off the shores of Louisiana for decades, but insurance costs are pushing him out of the area. He paid $5,800 in premiums in 2021 and $19,000 in 2024.
To make matters worse, the growing presence of liquified natural gas facilities along the coast has ruined fishing yields. His gross revenue has gone from $175,000 in 2019 to about $40,000.
"I've never seen it this bad," said LeJuine, per Capital & Main.
To add insult to injury, U.S. insurance companies have significant investments in the oil and gas industry. Using data from Urgewald's Investing in Climate Chaos database, Capital & Main noted that "in 2024, Berkshire Hathaway had almost $96 billion in fossil fuel investments, State Farm had more than $20 billion, Allianz had more than $26 billion and Chubb had nearly $900 million."
"They're investing in the cause of the problem," said LeJuine's neighbor, James Hiatt, per Capital & Main. His insurance has jumped upwards of 60%.
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Why is insurance important?
As more properties become uninsurable or too expensive to insure, the Senate Budget Committee expects a housing crisis worse than that of 2008.
The pollution caused by coal, gas, and oil is the primary driver of increasingly extreme weather patterns. These can include heat waves, floods, and droughts. In addition to housing risks, these disasters also cause steep costs in agriculture and ecology.
What's being done about insurance rates?
Building resilience measures at the home and community levels can help mitigate the damage caused by worsening climate trends. This can include weatherizing a home to accommodate higher temperatures or installing a native garden to mitigate surface flooding conditions while also minimizing water use during droughts.
The larger solution will require widespread pollution reduction across multiple sectors in order to stabilize weather patterns.
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Absolutely 💯 Some experts see the cycle among insurance companies continuing.
"The higher the premiums go due to climate risks, the more they have available to invest and the higher their investment profits," said policy advocate Carly Fabian, per Capital & Main.
"And their investment profits far outweigh what they're earning from collecting premiums and paying claims. So over time, there's a perverse incentive — to actually let premiums go up, collect more, invest more, profit more."
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