Boulder with Insurance Problems

For many years, and due to having flammable environments, the mountainous communities of Boulder in the state of Colorado have always had problems when it comes to obtaining insurance. With climate change, these issues are spreading beyond the mountainous areas and are causing wildfires to become a constant threat, leading to insurance prices increasing more and more each day in the state.

As a consequence, thousands of homeowners in Boulder are being extremely affected, as insurance companies are drastically raising their insurance premiums or simply refusing to provide coverage in certain areas of the city.

Currently, when obtaining home insurance, companies study all possible risk factors, such as vegetation or access to water for firefighters, before granting insurance. As a result of the study, many zip codes in Boulder are being considered high risk, causing more and more properties to be left unprotected.

Colorado has areas considered high risk, especially Boulder, and because of this, many insurance companies have decided to leave, and the few that remain are choosing not to renew policies, increase their premiums, or simply reduce their coverage, all in relation to the location and the different factors surrounding the home.

To somewhat improve the situation, insurers working in Colorado are making mitigation efforts to counteract the property insurance crisis in the state, especially in Boulder. However, the companies point out that this is everyone’s problem and as such, the responsibility should be shared by them, the communities, and the homeowners.

On one hand, insurers are trying to establish premiums that match the real risks of insuring homes, in order to guarantee the coverage of claims that may arise. And although setting premiums based on real risks could increase prices, mitigation efforts could help reduce costs in the future.

Among the mitigation efforts that the community has tried to promote is the Wildfire Partners Program, which helps homeowners understand their wildfire risks. This initiative is viewed favorably by insurers because it could help homeowners potentially obtain lower insurance rates.

However, real estate market experts have stated that even with significant mitigation efforts, some homes will still be considered too risky for insurers, and many homeowners will be forced to seek surplus lines insurance, which is not regulated by the state and typically charges very high prices due to the greater risk associated with the types of coverage they offer.

The biggest consequence of this is that now unprotected homeowners who wish to sell their homes cannot do so easily, and those who do will have to sell at very low prices. The difficulty of obtaining insurance and the high rates are causing thousands of homeowners to make significant financial efforts that are severely affecting their assets, pushing many of them towards bankruptcy or having to undergo foreclosure.

Available Foreclosures:

Boulder: 15 homes available.

By Elias DaSilva | October 4, 2024.