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Millions have moved out of certain parts of the country now designated “Climate Abandonment Areas”

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Climate change has driven 3.2 million people out of certain areas of the country.  (iStock)

More frequent flooding is leaving lasting damage, even as neighborhoods rebuild. Certain areas of the country are being deemed “Climate Abandonment Areas.” These areas are losing a large percentage of their population entirely due to climate change, specifically flooding, according to a First Street report.  

Climate Abandonment Areas include 818,000 U.S. Census blocks. Over 3.2 million people have moved away from these areas between 2000 and 2020 due to flooding damage. 

“There appears to be clear winners and losers in regard to the impact of flood risk on neighborhood level population change,” Dr. Jeremy Porter, the head of climate implications research at the First Street Foundation, said. 

“The downstream implications of this are massive and impact property values, neighborhood composition and commercial viability both positively and negatively.”

In the next 30 years, current Climate Abandonment Areas are expected to lose more of their populations. The populations are expected to decline by an additional 16%, equivalent to 2.5 million more people. 

“The population exposure over the next 30 years is a serious concern,” Evelyn Shu, a senior research analyst at the First Street Foundation, said.

“For decades we’ve chosen to build and develop in areas that we believed did not have significant risk, but due to the impacts of climate change, those areas are very rapidly beginning to look like areas we’ve avoided in the past.”

Having enough homeowners insurance is vital to protect you after a natural disaster. To ensure your insurance is suitable for your circumstances, visit Credible to check out plans, providers, and costs.

CLIMATE DISASTERS ARE DRIVING UP THE COST OF INSURANCE AND IMPACTING HOME VALUES: REPORT

California is one of the states struggling most with rising homeowners insurance rates

Of the 50 U.S. states, California is struggling the most with high homeowners insurance rates. Sky-high homeowners insurance rates are due, in part, to natural disasters like wildfires and mudslides. 

Citing the high risk and the costs associated with those risks, State Farm recently announced it will not continue to insure homes in certain areas. It’s cutting 72,000 home and commercial insurance policies. These cuts impact around 30,000 homeowners and rental insurance policies specifically. 

“We will continue to work constructively with the California Department of Insurance, the Governor’s Office, and policymakers to actively pursue these reforms in order to establish an environment in which insurance rates are better aligned with risk,” the State Farm press release stated. 

Starting July 3, 2024, and continuing through the year, State Farm will begin pulling out of the California homeowners insurance market. 

The same issue is happening in Florida, where Progressive has begun to pull some of its insurance policies. Starting in May 2024, to “rebalance their exposure”, they’ll stop renewing some policies. 

If you want to find a new homeowners insurance provider that offers lower rates, Credible can walk you through each homeowner’s insurance policy, the coverage they offer and show you the rates you may qualify for.

2023 WAS THE HOTTEST YEAR ON RECORD, DRIVING UP UTILITY COSTS AND HOMEOWNERS INSURANCE PRICES

Homeowners insurance isn’t rising as fast as principal and interest payments

While homeowners insurance rates are definitely on the rise, they’re not rising as much as principal and interest payments on mortgages, a Freddie Mac report found.

The cost of buying a home has skyrocketed over the last few years, largely due to high mortgage rates. That said, homeowners insurance still contributes significantly to the total cost of homeownership. 

In 2018, homeowners insurance premiums averaged $1,081 for Freddie Mac borrowers, but in 2023, they averaged $1,522 annually. That’s a 40.8% increase. 

Freddie Mac found that in 2018, premiums accounted for 1.49% of borrowers’ incomes. This rose by 10% by 2023 when 1.64% of a borrower’s income went towards monthly premiums. 

Certain states pay higher premiums than others. Louisiana, Kansas, Nebraska and Mississippi pay over $8 for every $1,000 in home value. All the while, borrowers from California, Washington, Nevada, Oregon, and Washington, DC all paid less than $2.50 for $1,000, according to the Freddie Mac report. 

Comparing multiple insurance quotes can potentially save you hundreds of dollars per year. Luckily, it’s easy to get a free quote in minutes through Credible’s partners

HOMEBUYERS GAINED THOUSANDS OF DOLLARS AS MORTGAGE INTEREST RATES FALL: REDFIN

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Jamie Dimon on Trump’s tariffs: ‘Get over it’

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Jamie Dimon on tariffs: If it's a little inflationary but good for national security, so be it

JPMorgan Chase CEO Jamie Dimon said Wednesday the looming tariffs that President Donald Trump is expected to slap on U.S. trading partners could be viewed positively.

Despite fears that the duties could spark a global trade war and reignite inflation domestically, the head of the largest U.S. bank by assets said they could protect American interests and bring trading partners back to the table for better deals for the country, if used correctly.

“If it’s a little inflationary, but it’s good for national security, so be it. I mean, get over it,” Dimon told CNBC’s Andrew Ross Sorkin during an interview at the World Economic Forum in Davos. “National security trumps a little bit more inflation.”

Since taking office Monday, Trump has been saber-rattling on tariffs, threatening Monday to impose levies on Mexico and Canada, then expanding the scope Tuesday to China and the European Union. The president told reporters that the EU is treating the U.S. “very, very badly” due to its large annual trade surplus. The U.S. last year ran a $214 billion deficit with the EU through November 2024.

Among the considerations are a 10% tariff on China and 25% on Canada and Mexico as the U.S. looks forward to a review on the tri-party agreement Trump negotiated during his first term. The U.S.-Mexico-Canada Trade Agreement is up for review in July 2026.

Dimon did not get into the details of Trump’s plans, but said it depends on how the duties are implemented. Trump has indicated the tariffs could take effect Feb. 1.

“I look at tariffs, they’re an economic tool, That’s it,” Dimon said. “They’re an economic weapon, depending on how you use it, why you use it, stuff like that. Tariffs are inflationary and not inflationary.”

Trump leveled broad-based tariffs during his first term, during which inflation ran below 2.5% each year. Despite the looming tariff threat, the U.S. dollar has drifted lower this week.

“Tariffs can change the dollar, but the most important thing is growth,” Dimon said.

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