Governor Jared Polis and the Colorado Division of Insurance (DOI) have released new data indicating that hail is a major factor driving up homeowners insurance premiums across the state. The DOI, which regulates the insurance industry and provides consumer protection resources according to its official website https://doi.colorado.gov/, collected information from 20 insurance carriers representing 80% of the market. This data covered average homeowner insurance premiums in 11 counties, breaking down how much is attributable to hail and wildfire risks.
“We know that homeowners insurance simply costs too much, and saving home homeowners money on insurance must be a part of the overall solution to lower the cost of housing. This data clearly outlines the problem, and now we must take innovative actions to lower insurance premiums, save people money, and increase home resilience and safety,” said Governor Polis.
The findings show that hail accounts for between 26% and 54% of total homeowner insurance premiums depending on the county. Even in areas with little hail activity, such as Summit County, residents pay an average of 35.6% of their premium for hail coverage while only 7.9% goes toward wildfire risk. In Colorado’s Front Range and Eastern Plains regions, about half of homeowners’ premiums are related to hail damage.
Wildfire risk contributes less to premium costs statewide, ranging from just under 1% up to nearly a quarter depending on location. Insurance companies focus higher pricing for wildfire risk in high-risk areas; for example, Denver residents see only about 1% of their premium attributed to wildfire risk.
“The data is clear: it is hail that is the biggest cost driver of homeowner insurance for families across the state. Even Coloradans who don’t live in hail-prone areas, such as in mountain communities, are paying for hail damage through their premiums. We can’t change the weather in Colorado, but we can and should help consumers in high risk areas fortify their roofs because that will help lower everyone’s premiums. And we have to find innovative solutions to help address affordability in our high wildfire areas of the state. To that end, we’re working with the Colorado General Assembly again this year on legislation to create a grant program for fortifying roofs, as well as a reinsurance program for wildfires,” said Colorado Insurance Commissioner Michael Conway.
The DOI operates throughout Colorado providing tools such as license verification services and complaint filing related to insurance matters https://doi.colorado.gov/. As a state agency focused on regulation https://doi.colorado.gov/, it extends oversight across all counties https://doi.colorado.gov/ while delivering online access to consumer protection information https://doi.colorado.gov/.
A summary document with details by county was also released alongside these findings.
