Sen Rosen Calls On Feds To Address Insurance Crisis in Northern Nevada
Rosen: ‘The cascading effects of an unstable insurance marketplace have the potential to reverberate throughout the entire economy’
By Megan Barth, July 25, 2024 9:44 am
This post has been updated to include a statement from Elizabeth Ray, Communications Director for Governor Lombardo.
The Globe was one of the first news outlets to report of the insurance crisis in Northern Nevada, specifically in the Tahoe Basin, where insurance companies are dropping or reducing coverage on properties in areas they have deemed “at risk” due to their proximity to or within “forested areas.”
American Family and Farmers Insurance have already abandoned many areas surrounding the lake, thereby limiting the options and eliminating home owner policies needed to not only protect the property, but needed to sell the property.
Recently, Senator Jacky Rosen (D-NV) penned a letter (see below) to Federal Insurance Office Director Steven Seitz and urged him to address the “cascading effect” of a potential economic crisis due to the lack of access to affordable insurance coverage, and asked for the federal government “to better understand the link between wildfires and rising insurance premiums.”
“The cascading effects of an unstable insurance marketplace have the potential to reverberate throughout the entire economy, causing unimaginable financial hardship for hardworking families throughout the country,” Rosen warned.
“As wildfire seasons become lengthier and more unstable, it is critical that Nevada homeowners have access to the affordable insurance coverage they need to protect their financial future and stay in their communities,” she continued. “While recent initiatives – such as FIO’s plan to collect data on climate risks more broadly– are a step in the right direction, more must be done to better understand the link between wildfires and rising insurance premiums so that policymakers, agencies, and stakeholders can take action to lower costs and increase coverage options.”
Beyond collecting data and conducting years-long studies, the immediate reality of non-renewals, combined with high-interest rates, is softening the real estate market and increasing valuable inventory as at-risk homeowners cannot afford skyrocketing premiums or Home Owner Association (HOA) assessments totaling tens-of-thousands of dollars. “Escrows cannot close and many are being cancelled,” said a 25-year realtor in the Basin.
The consequences of these insurance non-renewals is further explained by the founder of Lakeshore Realty Chris Plastiras who has been selling real estate in Incline Village, Nevada, for 45 years.
Plastiras told The Globe: “American Family is pulling out of Incline Village. Farmers is gone. State Farm is the only game in town, that I am aware of. In my perspective this will have a very negative effect on real estate values because we can’t get loans on homes that cannot get insurance. The insurance industry has seen fit to put us in a “high-risk” category that takes them out of the realm of being overseen by the insurance industry… allowing insurance companies to set pricing however they see fit. They can raise rates, relatively exponentially, and that becomes a problem. I have seen a lot of things. I have worked in the this market through four recessions and there is no quick fix unless the governor calls an emergency session of the legislature.”
Denise Bremer, President of the Incline Village Association of Realtors, further warns that this trend of non-renewals of home insurance policies is not isolated to “at risk” areas, but is spreading across Nevada, including Las Vegas. Bremer told The Globe: “This all started in California and it has naturally migrated this direction.”
“If push comes to shove, the commissioner could declare this as a critical situation and could get a special legislative meeting involved. At what point it this critical? The realtors do not know and we are waiting on his next move, ” she said.
An emergency session of the legislature may seem extreme to some, however, the situation is dire for many fixed-income homeowners who reside in single family homes or communities managed by an HOA. Many fear the worst if they wait until the next legislative session starting February 2024.
Nevada Insurance Commission Scott Kipper held a town hall in Incline Village last month to a packed room of concerned residents. An attendee told The Globe, “he said he couldn’t do anything until 2027.”
At the time of publishing, Commissioner Kipper’s office and Governor Lombardo’s office did not respond to our request for comment.
Update: The Office of the Governor is acutely aware of this issue and is actively working with the Nevada Division of Insurance to determine optimal access and affordable solutions. We appreciate the work of Senator Rosen and the Nevada delegation to assist Nevada consumers in finding solutions,”–Elizabeth Ray, Communications Director for Governor Lombardo.
7.17.24-Letter-to-FIO-Wildfire-Data-Final- Clark County School Teacher Launches Anti-Trump Tirade In 6th Grade Classroom - November 7, 2024
- Nearly 14K Ballots Need Signature Curing As Silver State Races Tighten - November 6, 2024
- Viral Video In Washoe County Leads to Dismissal of Election Certification Board Appointee Caught Stealing GOP Candidate’s Signs - November 4, 2024