More insurers are choosing to limit their exposure to climate risks, with some major carriers now pulling out of coastal Virginia neighborhoods.
WTKR News 3 spoke to one Hampton Roads resident whose homeowner’s policy was dropped by his insurance company in June.
Fred Drummond said he was told that Nationwide would not be renewing the policy he’s had for over 20 years, adding that he spent several days calling other companies to no avail.
“I started calling around to all the major companies including USAA, Hartford,” he told the local news channel. “And no one was writing any policies for this area.”
Drummond is not alone in this experience as major carriers continue the trend of exiting high-risk markets due to rising costs associated with natural catastrophes.
Farmers Insurance recently announced its decision to pull out of its own-branded business in Florida. This was followed by AAA issuing a statement that it will no longer renew home and auto insurance policies for some of its customers.
Meanwhile, in California, insurance groups have called for regulatory reform as Allstate, State Farm, Farmers, and AIG chose to stop or limit issuing homeowners policies due to wildfire risks.
“With record-breaking inflation, severe weather events, and reconstruction costs continuing to climb, we are focused on serving our customers while effectively managing our business,” Farmers said of its California pullback earlier this month.
When approached by WTKR News 3, insurance agents confirmed that some major companies have gone a similar route in Virginia Beach.
“They have to reduce their overall exposure,” said Greg Acton, who works with Armor Insurance Group Insurance. “Some carriers are deciding to pull out of Hampton roads altogether or reduce the amount they are looking to insure on the coast.”
This assessment was echoed by Nancy Rodgers of Bunn Insurance Agency, who pointed to “increased storm activity and regular claims activity” in the area.
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