Iowans struggle to find homeowners insurance as companies pullout of the state

CEDAR RAPIDS, Iowa (KCRG) - Some Iowans have struggled to find homeowners insurance as several companies pulled their business out of the state.

The reason companies said they were leaving Iowa was the growing number of severe storms, and the costs to make repairs once they’ve left their mark, and insurance companies said it has only gotten worse.

David Langston is the President of Beaver Creek Homeowners Association and one of his many tasks is making sure the 17 homes on East Post Court have insurance for what the HOA is responsible for, the outside of these homes. But in January, he got work that Pekin Insurance, the company they’ve used for years would no longer cover their homes.

“I was terrified and having sleepless nights trying to wrestle this into conclusion,” said Langston.

Langston isn’t alone. Pekin was one of at least four companies announcing it would no longer write homeowners insurance policies in the state of Iowa.

“I’ve never seen it this bad,” said Ed Faber, owner of Insurance Guru in Cedar Rapids.

Faber said the reason many of the companies were pulling out was because of the state’s history: the 2020 derecho, recent tornadoes, hail, and other damaging windstorms. The insurance industry said it saw a $21 billion underwriting loss last year.

“It has been year after year of bad weather events, but last year I started seeing companies that are pulling back on business,” said Faber.

The strength and cost of storms continue to climb, and Professor Dennis Smith with Florida State University said it was only going to continue.

“It’s something that we can’t hide from, we can’t deny, the science is there, and the earth is warming,” said Professor Smith. “The Earth is warming faster than it ever has been because of some of the actions we take as part of our civilization.”

Langston and Beaver Creek homeowners are paying the price right now. Their new policy is 50% higher than their last one.

“A lot of people are going to look around their neighborhood and think ‘we’re not being flooded on the coast, we’re not having fires, we’re not having earthquakes, we feel safe,” said Langston. “I don’t think people understand what tidal wave may be coming their way.”