New data released by Governor Polis and the Colorado Division of Insurance (DOI), part of the Department of Regulatory Agencies (DORA), highlights that hail is a primary factor driving up homeowners insurance costs in many Colorado counties. The DOI collected information from 20 homeowners insurance carriers, which together represent 80% of the state’s market, to better understand how premiums are determined across different regions.
The analysis focused on average homeowners insurance premiums for 11 counties, examining what portion of those premiums is linked to hail and wildfire risks. The data also considered discounts available for mitigation efforts against these risks.
Governor Polis commented on the findings: “We know that homeowners insurance simply costs too much, and saving home homeowners money on insurance must be a part of the overall solution to lower the cost of housing. This data clearly outlines the problem, and now we must take innovative actions to lower insurance premiums, save people money, and increase home resilience and safety.”
According to the DOI’s findings, hail accounts for between 26% and 54% of total homeowner insurance premiums depending on the county. Even in areas like Summit County—where hail is less common due to its mountainous terrain—hail still represents an average 35.6% of premium costs. In comparison, wildfire risk contributes only about 7.9% there. In Colorado’s Front Range and Eastern Plains, about half of a homeowner’s premium can be attributed to hail damage, while wildfire has a smaller impact.
Wildfire risk contributes between 0.9% and 24.6% toward homeowner insurance premiums depending on location. Insurers tend to charge higher rates for wildfire risk in high-risk areas but allocate much less for this factor in low-risk places; Denver residents see just about 1% of their premium go toward wildfire risk.
Colorado Insurance Commissioner Michael Conway stated: “The data is clear: it is hail that is the biggest cost driver of homeowner insurance for families across the state. Even Coloradans who don’t live in hail-prone areas, such as in mountain communities, are paying for hail damage through their premiums. We can’t change the weather in Colorado, but we can and should help consumers in high risk areas fortify their roofs because that will help lower everyone’s premiums. And we have to find innovative solutions to help address affordability in our high wildfire areas of the state. To that end, we’re working with the Colorado General Assembly again this year on legislation to create a grant program for fortifying roofs, as well as a reinsurance program for wildfires.”
A summary document with more details about these findings—including breakdowns by county—is available online.
