Forest fires and winter weather are raising Idaho’s homeowners insurance rates

Homeowners insurance rates have risen about 15 percent in Idaho since 2012 due to forest fires and winter storms, according to a new report by the personal finance website ValuePenguin.

In a report on Idaho, ValuePenguin research analyst Craig Casazza found that homeowners insurance rates in Idaho rose an average of 14.7 percent between 2012 and 2017 while national rates rose an average of 24.6 percent. Three Idaho insurers raised their rates by more than the national average: Mutual of Enumclaw, 37 percent; Nationwide, 34 percent; and Liberty Mutual, 27 percent.

But even with the nearly 15 percent increase applied to Idaho’s average homeowners insurance rate since 2012, Idaho has the lowest average homeowners insurance price in the country, according to ValuePenguin.

The average annual home insurance rate for the country is $978 per year. Idaho’s is $518, Oregon’s is $559 and Utah’s is $564. No other state has an average annual rate under $620, according to ValuePenguin.

“The interesting thing about Idaho is you guys have one of the cheapest average rates in the country,” Casazza said. “You don’t get the same natural disasters that we get here in the Northeast.”

The recent increases are the result of revenue losses for the insurance companies. Natural disasters have affected national companies like Nationwide and regional ones like Mutual of Enumclaw, which, in 2015, had losses that were 19 percent greater than its earnings due in large part to a windstorm that damaged homes in Washington and northern Idaho, Casazza said.

“There has been lots of bad weather like hurricanes and heavy rains throughout the country – especially in the Midwest where there have been floods in places that don’t usually get flooded,” Casazza said. “It’s leading to a lot of claims for companies that are being hit in all these different locations.”

He added that Enumclaw has all its business in the Pacific Northwest.

“So if you get one really bad event in the region, it hurts them,” he said.

While extreme weather has driven up prices around the nation, the effects have been most severe in the Midwest, where homeowners insurance has increased an average of 33.8 percent since 2012 and in southern states like Georgia, where insurance has gone up 38 percent since 2012, due in large part to natural disasters such as Hurricane Matthew in October, Casazza said.

In Idaho, forest fires, heavy snowfall and floods were to blame for many rate increases, said Dean Cameron, director of the Idaho Department of Insurance.

Last winter, Idaho saw severe flooding and unusual snowfall that caused many roofs to collapse. Those circumstances will probably increase rates again next year, Cameron said.

“It has been a tough year starting with the increased number of fires last year and of course this last winter,” he said. Many people don’t have flood insurance so they won’t be reimbursed for that damage.

“After every flood, we hear about homeowners who did not realize they needed to protect themselves with flood insurance,” Cameron said in a statement.

Many Idaho homes are also at perennial risk from wildfires. Idaho is the fifth most wildfire-prone state, with 163,500 homes considered to be at extreme risk of smoke and fire damage based on their proximity to wildlands, according to the Insurance Information Institute.