Senators take up looming insurance crisis as policy issuers flee Florida and California
View of a damaged property after the arrival of Hurricane Idalia in Horseshoe Beach, Florida, Aug. 31, 2023.

WASHINGTON — Low-income policyholders will be hit hardest by rising insurance premiums as the frequency of natural disasters caused by climate change increases and insurers pull out of some coverage areas, witnesses argued before a Senate panel on Thursday.

"We have seen our property and casualty insurance costs (increase) 400% in six years," said Michelle Norris, executive vice president of external affairs and strategic initiatives for National Church Residences, a nationwide affordable senior housing organization.

"Even developers and owners with very large portfolios, like ours, have little bargaining power in today's industry," Norris added in her testimony before the Senate Banking Committee.

Some insurers have stopped adding new policies in states like Florida, California and others that have been heavily affected by climate-related events, making disaster recovery harder for people in those regions and reinsurance more difficult to attain, according to experts.

Persistent weather events have led to rate increases and reductions in coverage offered, often overburdening low-income residents. The average cost of property insurance has soared in recent years, according to an analysis by credit rating firm S&P Global Ratings.

"Without insurance, millions of families will be at greater risk for climate crises," Sen. Elizabeth Warren, D-Mass., a member of the committee, said during the hearing. "And as whole communities lose access to insurance, the impact is going to be felt all the way through our economy."