Californians could save $3,800 if Big Oil pays for climate-driven insurance hikes

More than 1 in 5 California homeowners are now uninsured — not because they don’t want coverage, but because they can’t afford it. Premiums have surged, policies have been canceled, and entire communities are being forced into the state’s insurer of last resort, a program that has seen enrollment quadruple since 2019. In 2024 alone, 13% of real estate agents reported deals falling through because buyers couldn’t secure affordable home insurance. The crisis is no longer isolated. It’s derailing home purchases, pushing up rents, and deepening housing insecurity across the state.

The immediate trigger is clear: extreme weather. The Los Angeles wildfires caused over $75 billion in insured losses. In San Diego, flooding in 2024 damaged nearly 5,000 structures. This year’s April 1 snowpack was just 18% of average — the second lowest on record — heightening drought and fire risk. As disasters grow more frequent and costly, insurers pass those costs to consumers. State Farm alone secured approval for cumulative rate increases of 45% between 2023 and 2025, raising average annual premiums by $841.

But the deeper driver is accountability. For decades, large oil and gas corporations concealed the climate impact of their products and obstructed clean energy transitions. Now, Californians are paying the price in higher insurance bills. Senate Bill 982, the Affordable Insurance and Recovery Act, targets that imbalance. It would empower the Attorney General to sue Big Oil to recover their share of climate change’s contribution to weather disasters that inflate insurance costs. The funds recovered would stabilize the state’s insurer of last resort, shield consumers from sharp premium hikes, and finance home hardening against wildfires.

Independent modeling shows that recovering even a portion of recent climate-related insurance increases could save the average California household $3,800.