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Damage from Helene and Milton could cost tens of billions of dollars to fix

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Much of the damage done by Hurricane Helene will not be covered by insurance. Homeowners policies just don't cover flood damage, and many people whose homes were underwater did not have supplemental flood insurance. The price tag from Hurricanes Helene and Milton is expected to be in the tens of billions of dollars. And that is likely going to make it even more costly to insure property in the future. NPR's Scott Horsley reports.

SCOTT HORSLEY, BYLINE: Barbara Stewart and her husband spent almost 50 years on the west coast of Florida. But after weathering Hurricanes Irma and Ian, they finally packed up last summer and moved inland.

BARBARA STEWART: We saw the handwriting on the wall that because of all the damage, insurance was going to go up, and, in fact, talking to my neighbors, it's increased about $200 a month since we've gone.

HORSLEY: Stewart was largely insulated this year when Hurricane Helene and Milton hit, although she did lose power for about a day and a half.

STEWART: We just kept saying, sure glad we moved inland. But lots of other friends and family to be concerned about.

HORSLEY: Stewart may still feel the fallout of the storms in her own insurance bills. The average homeowners policy in Florida already tops $10,000 a year, and premiums around the country have been climbing at double-digit rates. Dale Porfilio, who's with the Insurance Information Institute, says the industry is playing catch-up after several years of costly disasters, which were compounded by inflation.

DALE PORFILIO: Everybody would love it if the products that they buy every day cost less, whether it's insurance or groceries or movie tickets or gasoline. Nobody loves it when price goes up. But it is reflecting the cost of doing business and the fact that the parts that we're putting into cars and homes are costing more, and so the product does need to as well.

HORSLEY: The cost of repairing and rebuilding homes and cars is no longer climbing as fast as it was a couple of years ago. But unlike inflation, destructive weather shows no signs of easing. Doug Heller, who tracks insurance at the Consumer Federation of America, suspects carriers will keep trying to pass those costs on to their customers.

DOUG HELLER: The insurance companies always look at disasters opportunistically. It's a chance to get rate hikes because Americans have just seen what happens, and so they feel that regulators will go soft on us.

HORSLEY: Making matters worse, much of the damage from Hurricane Helene was caused by flooding, which isn't covered by homeowners insurance. As a result, Heller worries many of those who were hardest hit will struggle to rebuild. Costly catastrophes are no longer confined to predictable flood zones and coastal parts of the country. Heller notes some of the most expensive disasters last year were hailstorms in landlocked states like Colorado.

HELLER: The evidence is in. Climate change is affecting all of us. We're better off if we all buy a comprehensive insurance policy. It will help folks in one part of the country deal with hurricanes and another part of the country deal with hail storms or firestorms or floods wherever they may occur.

HORSLEY: In addition to raising prices, some insurance companies are scaling back the number of policies they'll write in a particular area to avoid facing a huge payout from a single weather-related event. George Hosfield is with LexisNexis Risk Solutions, which helps insurers track their exposure. He says, customers can take steps to make their homes safer and shop around for cheaper insurance, but over the long term, he warns, premiums are likely to keep climbing.

GEORGE HOSFIELD: Nobody is expecting climate change to reverse. We're anticipating that severity and frequency of insurance claims will continue to trend upward. They're probably not at the rate that they've gone up over the last couple of years.

HORSLEY: For Barbara Stewart and her husband, that's the price of living in Florida, even if they're now 40 miles from the coast.

STEWART: People just need to be prepared and factor that into what their cost of living might be. Scott Horsley, NPR News, Washington. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

Scott Horsley is NPR's Chief Economics Correspondent. He reports on ups and downs in the national economy as well as fault lines between booming and busting communities.