Climate change drives rising insurance costs and claims

Vero Insurance reported that weather-related natural hazard claims reached $184.6 million over the past fiscal year, a significant increase from $70.6 million the previous year. The company, owned by Suncorp Group Limited, projected that climate change could drive claims costs up by 12% to 15% by 2040 and between 21% to 27% by 2050.

In the United States, a survey by Insurance.com indicates a disconnect between consumer perception and expert warnings regarding climate change and insurance rates. While experts and government reports from the Congressional Budget Office and the U.S. Department of the Treasury link rising premiums to climate-related risks, only 43% of surveyed homeowners believe climate change is impacting their local insurance market. Additionally, 69% of homeowners have not increased their coverage levels to match rising rebuilding costs, often due to economic constraints.