One in 22 Utah home insurance policies dropped as major insurers exited part of the market

Utah homeowners are being forced to find new insurance after companies declined to renew roughly one in every 22 home policies, giving the state the highest nonrenewal rate in the nation.

Here's what to know

Data from the National Association of Insurance Commissioners show that 4.45% of homeowners' policies in Utah were not renewed, compared with 2.93% in California, the state with the next-highest rate, according to KSL.

Utah Insurance Commissioner Jon Pike said several insurers ended coverage for all their customers in that part of the market, rather than making decisions based on individual circumstances.

"Three large companies that just said, 'We're getting out of this piece of the business,'" Pike said.

Pike said Utah would be nearer the norm if the figures did not include policies lost through those company withdrawals.

More background

Pike said insurers in Utah and elsewhere in the West face rising rebuilding costs because of inflation, along with drought-driven increases in the frequency and intensity of fires. Meanwhile, more homes are being built where developed areas border undeveloped land.

These areas, known as the "wildland urban interface," expose more homes to wildfire risks that insurers must account for. Higher rebuilding costs also increase the financial consequences when a property is damaged.

Pike called the situation "kinda a perfect storm in Utah."

"They're conservative organizations. You know, they've got risk to deal with," he added, explaining how insurers approach those pressures.

What's being done?

Officials at the Utah Department of Insurance say the market appears to be stabilizing, even as nonrenewals remain high. The department continues to monitor the trends.

Pike said he was unaware of any homeowner who had been unable to find replacement coverage, though he acknowledged the large number of people who had lost their policies.

KSL asked the commissioner about the cost of that replacement coverage: "So there's options, but are they affordable?"

Pike responded, "And that's the question, right?"

Where can I learn more?

These stories cover dropped policies, coverage gaps, wildfire-related insurance challenges, and changes to earthquake protection.

• Texas homeowners can now see why insurers are dropping policies in their ZIP code.

• A Missouri homeowner says an insurer refused to renew coverage over a Google review.

• In California's Inland Empire, even new homes face gaps in available insurance coverage.

• Oregon homeowners facing wildfire-related insurance pressures can get one-on-one help at open houses.

• Some insurance customers say earthquake coverage was gutted when their policies renewed.

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