10 States Facing the Highest Financial Losses from Severe Weather | Insurify

Climate change has made extreme weather more prevalent and intense.1 Those consequences are showing up in home insurance premiums, with the average annual cost increasing 30% — $740 — since 2021.

Homeowners in states with more extreme weather tend to face higher insurance costs. Insurers charge higher premiums if an area is more likely to suffer catastrophic losses, since it puts insurers at greater risk of taking a massive financial hit.

If homeowners aren't familiar with the disaster risks in their state, they could end up underinsured, caught off guard by rate hikes, or otherwise unprepared for the financial and physical risks that come with living in a vulnerable area.

One way to gauge an area's financial vulnerability is to examine its projected losses from extreme weather and other natural hazards.

"Extreme weather is the main factor driving up home insurance costs," said Mallory Mooney, director of sales and service at Insurify. "That includes both recurring weather events like hail or high winds, and individual disasters like hurricanes or wildfires."

For example, California could incur more than $15 billion in losses from weather and disasters in an average year — 300 times more than Vermont, according to the National Risk Index (NRI), part of the Federal Emergency Management Agency (FEMA).2

Those totals don't tell the whole story, as states with more people and infrastructure naturally have more assets at risk. A different picture takes shape when looking at expected losses per person.

Insurify data scientists ranked the top 10 states that face the most financial losses per capita, underscoring where homeowners, and often their insurers, stand to lose the most. For example, Florida and Louisiana, the two states with the highest expected losses per capita, also have the highest annual home insurance costs of any state.

Key findings

At the state level, Louisiana residents stand to lose the most financially from natural disasters. Threatened by hurricanes and flooding, the state has expected annual losses of $2.5 billion each year. That comes out to $547 per resident, the highest rate in the country.Analysts expect California to face about $15.2 billion in losses from natural disasters each year, using a combination of building value and population value. Earthquakes and wildfires account for the majority of those potential losses.Homeowners in the 10 states that Insurify ranked pay about $2,000 more in annual home insurance costs than the national average — $5,314 vs. $3,259.At the county level, Childress County, Texas, has the nation's highest expected losses per resident, projected at $3,383 annually. Los Angeles County has the highest expected losses overall, at $3.9 billion annually.

10 states where homeowners face the highest financial losses from severe weather

1. Louisiana

Per capita expected annual losses: $547Total expected annual losses: $2.5 billionAverage annual cost of home insurance (2024): $10,964

Louisiana homeowners pay more than triple the national average for home insurance, with extreme weather serving as a primary driver. Homeowners in Louisiana have to worry about danger from flooding, tornadoes, and hurricanes. In addition to standard home insurance coverage, residents in higher-risk areas of the state may need supplemental coverage for hurricane damage and a separate flood insurance policy.

Hurricanes are the most financially costly type of disaster, and eight have hit the state since the start of 2020.3 Hurricanes account for $1.4 billion of the state's expected annual losses, followed by river flooding, at $691 million. That includes about $99 million in expected losses from river flooding in Lafayette County alone.

Higher disaster losses cause insurance companies to provide larger payouts, and those companies tend to pass that financial burden on to homeowners through higher premiums. Louisiana has the second-highest home insurance premiums in the country, behind only Florida. Those costs put even more financial pressure on residents in a state with the third-lowest median household income.

To respond to rising risk and insurance costs, the state launched the Louisiana Fortify Homes Program in 2023, which offers a limited number of $10,000 grants for homeowners to upgrade to a more storm-resistant roof.

2. Florida

Per capita expected annual losses: $416Total expected annual losses: $8.9 billionAverage annual cost of home insurance (2024): $14,140

Florida's frequent natural disasters contribute to homeowners there paying the highest home insurance premiums in the country. Researchers estimate the state faces a 35% chance of a major hurricane in 2025. Hurricanes bring wind damage and flooding, which can lead to costly repairs.

Since standard home insurance doesn't cover weather-related flooding, many residents need additional flood insurance. In fact, Florida accounts for 38% of National Flood Insurance Program (NFIP) policies nationwide. The NRI rates 34 of Florida's 67 counties as having very high or relatively high risk of hurricane damage.

Overall, Florida ranks second nationally for expected annual losses from natural hazards per capita. Not only is the state a hurricane hotspot, it also faces high losses from lightning, wildfires, tornadoes, and river flooding. Hurricanes are the biggest contributor to Florida's $8.9 billion expected annual losses, at $7.7 billion, followed by tornadoes ($461 million) and wildfires ($269 million).

Actual losses have surpassed estimates in recent years. Major disasters impacting Florida have caused an estimated $240 billion in damages since 2020, with 2024 hurricanes Helene and Milton accounting for about $100 billion of those costs.

Following those storms, Florida launched the My Safe Condo program, a spinoff of the My Safe Home program. The My Safe Home program offers free wind inspections and matching grants of up to $10,000 for storm-resistant upgrades.

3. South Carolina

Per capita expected annual losses: $413Total expected annual losses: $2.1 billionAverage annual cost of home insurance (2024): $4,017

Homeowners in South Carolina are among the most threatened by natural disasters, mainly due to hurricane risk. Residents stand to lose the third most from severe weather on a per-person basis. Annual home insurance costs in the state are about 23% higher than the national average.

Of the state's $2.1 billion in projected annual losses, nearly $1.5 billion would come from hurricanes. At a local level, Charleston County has the highest projected losses in the state. The costliest storm to hit South Carolina, Hurricane Hugo, made landfall in Charleston County in 1989. The storm contributed to more than 30 deaths in the state and caused nearly $23 billion in damages when adjusted for inflation.4 5

To mitigate potential hurricane damage, the state has the South Carolina Safe Home Program. The initiative provides grants of up to $7,500 to coastal property owners to strengthen their homes against hurricanes and wind damage.

Other forms of severe weather affect the interior of South Carolina. Despite a relatively warm climate, South Carolina has comparatively high expected losses from ice storms, including about $33 million in projected building damage per year. Ice storms can cause a variety of problems for homeowners, putting roofs under immense strain and causing branches or entire trees to fall.

4. South Dakota

Per capita expected annual losses: $389Total expected annual losses: $344 millionAverage annual cost of home insurance (2024): $3,596

Homeowners in South Dakota have to contend with a variety of hazards, including tornadoes, cold waves, wildfires, hail, and river flooding, among other risks. Standard home insurance coverage includes protection against tornadoes, but flood protection requires its own insurance policy.

Risk analysts project that tornadoes account for $107 million in expected annual losses in human and building costs. Minnehaha County, the most populous in the state and home to Sioux Falls, has the highest projected losses due to tornadoes. NRI analysts expect about two tornadoes to strike there every three years, or 0.7 events per year.

Hail is another major concern for South Dakota, causing a projected $35 million in damages across the state annually, according to NRI data. The hail season has reportedly grown longer in South Dakota over the past half century, up to 173 days annually compared to 138 days annually in the 1970s.6 Again, the Sioux Falls area carries the largest share of the expected losses from hail.

Additionally, wildfires could cost the state $38 million annually, with counties in the western part of South Dakota facing the highest expected losses. Homeowners in this part of the state may have a harder time finding affordable home insurance due to some insurers declining to renew policies. Homeowners in Butte County and Fall River County, in particular, are twice as likely as other homeowners in the state to have their policy non-renewed.7

5. California

Per capita expected annual losses: $385Total expected annual losses: $15.2 billionAverage annual cost of home insurance (2024): $2,424

Wildfires remain a pressing problem for California homeowners, with the January fires in Los Angeles County serving as the most recent reminder. The Palisades and Eaton fires caused insured losses of up to $45 billion, according to a UCLA analysis.8 Those losses will drive up insurance costs for homeowners. In the wake of the fires, state insurance officials approved a 17% rate hike for State Farm, the state's largest home insurer. Soon after, State Farm requested a further 11% increase, citing the need to recover high losses.

Homeowners who want to prepare their homes for wildfire danger can take advantage of the Safer From Wildfires program. The program requires insurers to provide discounts for those who take certain fireproofing steps, such as installing a fire-rated roof or creating defensible space around the home.

Wildfires, however, aren't the only risk facing California homeowners. Earthquakes, river flooding, heat waves, and tornadoes are among the most expensive hazards threatening the state. Earthquakes are the top driver behind California's expected losses, estimated at $13.2 billion annually.

That estimate accounts for the potential of a large, outlier earthquake.In general, the state averages about two or three earthquakes large enough to cause moderate damage to buildings each year.9 Homeowners in affected areas have to take extra financial precautions in case of earthquakes, as standard home insurance policies generally do not cover them.

6. North Dakota

Per capita expected annual losses: $356Total expected annual losses: $277 millionAverage annual cost of home insurance (2024): $3,712

North Dakota doesn't often grab headlines for natural disasters. But homeowners in North Dakota pay 14% over the national average for home insurance, and face damage from river flooding, strong winds, hail, and winter weather.

Risk analysts have estimated the state's annual losses from strong winds and tornadoes at more than $77 million per year. In January, the state's insurance commissioner testified in support of a bill that would provide grants to insurers to incentivize them to expand property coverage. Commissioner Jon Godfread told the state Senate's Industry and Business Committee that severe weather, limited insurer participation, and growing premiums make the legislation urgent.10

North Dakota homeowners are especially vulnerable to damage stemming from cold, as the state ranks third nationally in expected losses from winter weather. Cold weather puts homeowners at risk of burst pipes, power outages, falling trees, and roof damage from snow or ice buildup.

7. Oregon

Per capita expected annual losses: $337Total expected annual losses: $1.4 billionAverage annual cost of home insurance (2024): $1,617

The home insurance market in Oregon is more stable than in many states on this list. But that doesn't mean homeowners there are immune to serious financial risks from natural disasters. Oregon is one of 15 states facing more than $1 billion in expected annual losses from hazards. The bulk of those losses comes from potential earthquake damage.

Standard home insurance policies don't cover earthquakes. If they did, Oregon's home insurance costs would likely be significantly higher. About 20% of Oregon residents have earthquake coverage, which people must purchase separately from home insurance.11

After earthquake damage, wildfire is the next most expensive threat in the state, with annual expected losses of $67 million. Oregon requires home insurance policies to include wildfire coverage. Some residents may benefit from the Wildfire Prepared program. Under the program, homeowners who certify that they've mitigated fire threats to their home may be eligible for discounted insurance premiums.

8. Mississippi

Per capita expected annual losses: $325Total expected annual losses: $960 millionAverage annual cost of home insurance (2024): $4,809

Mississippi homeowners face the seventh-highest home insurance costs in the country, with vulnerability to hurricanes and tornadoes contributing to high premiums.

Hurricanes are a major concern for those in coastal counties, where homeowners pay about twice as much in premiums as inland counties.12 Since 2020, Mississippi has faced six hurricanes that caused at least $1 billion in damage.

With overwhelming risk, some insurers are pulling back from coastal counties in the state, making it harder for homeowners to maintain coverage. Insurers non-renewed about 5% of policies in Harrison and Jackson counties in 2023.7

Tornadoes account for the second-largest portion of expected losses for Mississippi, at $230 million. The state has seen an increase in tornado activity in recent years, going from about 30 per year to 45, according to state insurance officials. In March 2023, a tornado outbreak near the state's eastern border saw winds of up to 195 mph. At that speed, the winds were strong enough to toss a school bus into nearby trees and ultimately caused 20 deaths and 170 injuries.13

9. Texas

Per capita expected annual losses: $277Total expected annual losses: $8.1 billionAverage annual cost of home insurance (2024): $6,005

Texas homeowners pay the fourth-highest price for insurance of any state, facing threats from hurricanes, tornadoes, flooding, hail, wildfires, and various other forms of extreme weather. From 2020 through 2024, the state experienced 68 individual disasters that caused at least $1 billion in damage, the most of any state. Its most expensive problem, according to risk analysts, is hurricane damage.

The most significant hurricane in recent memory was Hurricane Harvey, which caused $160 billion in estimated damages in 2017. Massive flooding from the storm destroyed or damaged more than 200,000 buildings. Harris County, home of Houston, saw severe storm impacts from Harvey. It's the nation's only county where the NRI projects more than $1 billion in annual expected losses from hurricanes.

Homeowners away from the coast face different types of disasters, including tornadoes and hail. Those natural hazards and others contribute to Texas' home insurance costs being nearly double the national average ($6,005 vs. $3,259).

State officials have to balance the need to tamp down rising premiums without driving insurers away. Texas is a file-and-use state, meaning insurers can raise rates before state regulators approve the hike. A new bill would require regulators to approve hikes of more than 10% before implementation.14

10. Washington

Per capita expected annual losses: $277Total expected annual losses: $2.1 billionAverage annual cost of home insurance (2024): $1,854

Like Oregon, Washington has exposure to natural disasters, but the state's home insurance costs don't always reflect that risk. Earthquakes, which standard homeowners policies typically exclude, account for the largest share of Washington's expected losses from disasters, at about $1.7 billion in human and building costs.

The NRI also attributes $198 million in annual expected losses from volcanoes — another disaster that strikes infrequently but could cause overwhelming financial devastation. Home insurance does cover some damages from volcanoes, such as lava flow, but not associated earthquakes or landslides.

The state's third most costly risk comes from wildfire damage, projected at $90 million annually. In 2023, two fires in the Spokane area burned 23,000 acres and destroyed 366 homes.15 Home insurance typically covers wildfire damage, although state insurance officials believe many of those who lost homes in the fire were underinsured.

Homeowners who want to take extra steps to prepare can look into the Wildfire Ready program, where an expert will recommend steps for fireproofing their home.

States where homeowners face the lowest losses from natural disasters

Every state faces some level of severe weather risk, but homeowners in states with low expected losses may have less to worry about. States with less financial vulnerability are generally less of a liability for home insurers, meaning they don't need to charge as much in premiums to maintain operations.

1. Ohio

Per capita expected annual losses: $63Total expected annual losses: $737 millionAverage annual cost of home insurance (2024): $1,851

Adjusted for its population, Ohio has the lowest financial vulnerability from natural disasters. With fewer weather risks, homeowners in Ohio pay about half the annual national average cost for insurance ($1,851 vs. $3,259). NRI analysts rate all the state's counties as either moderate or low for expected annual losses.

Tornadoes, which home insurance typically covers, account for most of the potential losses facing Ohio homeowners. River flooding is another concern, with more than 23,000 residents signed up for NFIP policies.

2. Arizona

Per capita expected annual losses: $65Total expected annual losses: $464 millionAverage annual cost of home insurance (2024): $3,012

In recent years, Arizona home insurance costs have gone up, although not as fast as they have in other western states. Homeowners in Arizona still pay below the national average cost for insurance, and insurers aren't scaling back coverage in the state as much as they are in riskier regions. Arizona has below-average expected annual losses from natural disasters and much less in projected damages than other states of its size.

Homeowners still have to consider some disaster risks. Wildfires account for nearly $195 million in annual expected losses. The state's dry climate and expanding development in areas near wildland contribute to wildfire potential.

3. New York

Per capita expected annual losses: $68Total expected annual losses: $1.4 billionAverage annual cost of home insurance (2024): $2,732

Severe weather has a presence in New York, but not nearly to the same extent as in the other most populous states. The home insurance market in the state is relatively stable, with average annual costs declining about 7% in 2024. The state has one of the lowest non-renewal rates in the country, meaning it's relatively rare for insurers to decline to continue existing policies.

At the same time, New York homeowners, especially those near the coasts, have to keep hurricane and flood risks in mind. Hurricane potential makes up the largest share of the state's expected annual losses from disasters, at about $600 million. Hurricane Sandy caused nearly $90 billion in damage across multiple states in the region, and in 2021, Hurricane Ida led the state to declare a flash flooding emergency.

Counties where homeowners face the highest financial losses

Expected losses vary by state, but are even more wide-ranging at a more local level. In certain counties, homeowners and residents face disproportionately high costs from natural disasters.

Childress County, Texas, has the nation's highest expected losses per resident. Homeowners in this county of 6,400 have to watch out for strong winds and hail damage. Hail can batter roofs and break windows, leading to insurance claims and rising premiums. In total, Childress County faces nearly $22 million in expected losses from weather and disasters each year. That includes about $9 million in damage from strong winds and about $7 million in hail damage.

Hyde County and Dare County, situated along the Outer Banks of North Carolina, have the second- and third-highest expected losses per resident. Homeowners in these hurricane-prone counties should know that a standard home insurance policy won't cover them against flooding from hurricanes. And some insurers in risky areas also exclude windstorm coverage. Hurricane damage often has its own deductible based on a percentage of the home's value rather than a flat dollar amount.

Using total estimated losses, rather than per capita figures, Los Angeles County has the highest expected losses in the country, at $3.9 billion. If it were a state, it'd rank fourth nationally for total expected losses. Homeowners here have a variety of dangers to be mindful of. In addition to wildfire damage, which standard home policies often cover, they might need to purchase separate coverage for flooding or earthquakes.

Harris County, Texas, and Santa Clara County, California, are second and third for total expected losses. These counties have many homeowners who have relatively high home values. These residents would benefit from making sure they have enough dwelling coverage to fully replace their homes if a disaster renders them uninhabitable.

Counties where homeowners face the lowest losses

Severe weather affects everyone, but homeowners in some counties have much less to contend with.

Adjusted for population, Ketchikan Gateway Borough in Alaska has the lowest expected annual losses from natural disasters. Risk analysts expect just $145,174 in disaster damage per year, attributed to the potential for earthquakes and winter weather impacts. Homeowners in Alaska tend to benefit from a relatively stable insurance market — only Vermont pays less in average annual home insurance costs.

The second-lowest rate of expected financial losses per person is in Allegheny County, Pennsylvania, home of Pittsburgh. For perspective, analysts project Los Angeles County to incur 200 times more disaster-related financial damage in a typical year compared to Allegheny County. As a whole, Pennsylvania is one of the 10 cheapest states for home insurance.

Using total figures, rather than per capita, Loving County, Texas, has the lowest expected losses from disasters, at just $38,806 annually. Though it's also the least populated county in the country, with 64 residents, according to Census data.

Dealing with severe weather as a homeowner

Extreme weather events pose serious financial risks to homeowners. But they can take steps to protect their investment and limit their losses if disaster strikes. Homeowners should carefully review their insurance policies to check whether they need supplemental protection against disasters often excluded from standard home insurance policies, such as earthquakes or natural flooding.

Weather-proofing one's home is another smart step. For example, installing hurricane shutters or impact-resistant windows can limit damage from debris caught in high winds. Some home insurers offer financial incentives for improvements like these, since they lower the risk of serious damage — and insurers' odds of having to make a large claim payout. Additionally, homeowners in some areas can take advantage of grant programs administered by state governments or federal agencies, which offer funds for home-hardening projects.

Homeowners should also consider comparing policies from different insurers once or twice a year to take advantage of competition among insurers and potentially find one that can provide similar coverage for a lower price.

Methodology

Expected annual loss data in this report comes from the National Risk Index, which groups financial losses into three categories: building value, human value, and agricultural value. This report ranked states based on per capita expected losses, excluding agriculture-related losses. Insurify's analysis included 50 states, but excluded Washington, D.C., and non-state territories. Per capita figures represent the total expected losses in building and population value divided by the state's 2020 Census population.

Home insurance rates in this report represent the average annual cost of an HO-3 insurance policy for homeowners with good credit and zero claims within the past five years, covering a single-family frame house with the following coverage limits: $400,000 dwelling, $25,000 personal property, $30,000 loss of use, $300,000 liability, and a $1,000 deductible. Actual premiums may vary based on individual circumstances, including location, home construction, insurer, and policy details.

Insurify gathered Quadrant Information Services rates, which include 10 to 15 of the largest insurers by market share in each state, in representative ZIP codes in the 10 largest urban areas in every state. Statewide costs reflect the average rate for homeowners across these ZIP codes. These ZIP codes serve as representative samples and may not capture all regional variations in pricing.