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The big idea

Climate change fuels an insurance crisis

You probably missed the second-biggest national political story of the past week, assuming you agree the debt limit deal is the first. It’s this: State Farm, arguably California’s largest provider of home insurance, won’t accept any new applications for that service in the Golden State.

Why? My colleague Anumita Kaur had the details on Sunday (yes, The Daily 202 missed the piece when it ran) and explained that it boils down to “the increased risk of catastrophes like wildfires and high construction costs.”

“The decision, which won’t impact current customers, went into effect Saturday and signals the growing threats to insurance availability and affordability in the face of climate crisis-fueled disasters,” Anumita reported, citing experts.

The Daily 202’s working definition of “politics” is the way a community, state or country organizes itself to allocate finite (or even scarce) resources, address internal grievances and blunt external threats. So this is a political story, with extensive economic and social ramifications.

The climate angle

In a statement, State Farm cited “rapidly growing catastrophe exposure” among the key factors behind its decision. That’s pretty much code for “climate change is making things worse.”

Or, as Anumita reported: “As climate risks — ranging from wildfires, drought, extreme precipitation and storm surge — intensify in California and throughout the country, insurance companies and government regulation will have to find a way adapt, said Noah Diffenbaugh, a climate scientist and professor at Stanford University.”

  • We’ll come back to “and throughout the country” in a second. First, here’s my colleague’s description of the scale in California:

“Nearly 25,000 homes and other buildings across California have been destroyed by massive fires in the past five years. Thousands more have been badly damaged. A California Department of Insurance assessment predicted that by 2100, an average of 77 percent more acres will burn every year across the state, and insurance companies ‘may withdraw from offering insurance’ as conditions worsen, The Post previously reported.”

Way beyond California

On Wednesday, Christopher Flavelle, Jill Cowan and Ivan Penn of the New York Times took a broader look at the phenomenon across the country.

“In parts of eastern Kentucky ravaged by storms last summer, the price of flood insurance is set to quadruple. In Louisiana, the top insurance official says the market is in crisis, and is offering millions of dollars in subsidies to try to draw insurers to the state,” they reported.

“And in much of Florida, homeowners are increasingly struggling to buy storm coverage. Most big insurers have pulled out of the state already, sending homeowners to smaller private companies that are straining to stay in business — a possible glimpse into California’s future if more big insurers leave.

  • (Before you race to blame Gov. Ron DeSantis, who is running for the Republican presidential nomination, for all of Florida’s woes, consider that the problem there really took a turn “after Hurricane Andrew devastated Miami in 1992” and most national carriers fled, the Times reported.)

Florida put together a system that relied on a state-created insurer of last resort for people who could not obtain private insurance and bet on a model the Times described as “One bad year of claims, followed by a few quiet years to build back their reserves.”

But after Hurricane Irma hit in 2017, the Times wrote, “almost every year has been bad.”

Louisiana’s woes

Like Florida, Louisiana regularly gets pummeled by powerful storms. Unlike Florida, Louisiana doesn’t have a steady influx of people of means.

As a fervent supporter of local news, The Daily 202 turned to the Times-Picayune, where we found this report from late March by James Finn and Michael Finch II about lawmakers groping their way to a solution to the state’s insurance crisis.

“State officials, lawmakers and consumer advocates generally agree that the so-called Insure Louisiana Incentive Program is a solid step — but that it amounts to a temporary fix for an insurance landscape in disarray. A dozen insurers have gone belly-up, leaving well over 100,000 Louisiana households with no place to turn for insurance besides Citizens, the state’s insurer of last resort,” they reported.

  • “Officials have tried to right the ship by enticing companies to write policies here with millions in incentive payments,” they wrote.
  • They’re also looking at bills to strengthen roofs (potentially lowering premiums), letting insurance companies adjust their rates more often, putting new limits that make it harder for homeowners to sue their insurance companies (as Florida has done under DeSantis), and incentives to retrofit homes to be more hurricane-resistant (as Alabama has done.)

It’s too soon to know whether a set of best practices will emerge for states struggling with home insurance, or whether any of them will find an effective mix of policies that protect their citizens as well as companies’ bottom lines. 

But the stakes involve millions of people and billions of dollars.


What’s happening now

Senate racing to pass debt ceiling bill ahead of Monday default deadline

“Senate leaders are imploring their colleagues to move quickly to approve a House-passed bill ahead of a Monday deadline that would suspend the debt ceiling, limit federal spending and avert a catastrophic U.S. government default … Both Senate Majority Leader Charles E. Schumer (D-N.Y.). and Senate Minority Leader Mitch McConnell (R-Ky.) have urged their colleagues to act well before Monday, when the nation will no longer be able to pay its bills,” John Wagner reports.

Medicare to expand coverage for a new class of costly Alzheimer’s drugs

Medicare officials announced plans Thursday to broadly cover a new class of Alzheimer’s drugs following an intense lobbying campaign by patient advocates and drugmakers pressing for access to the first medications shown to slow cognitive decline from the disease,” Laurie McGinley and Rachel Roubein report.

Lunchtime reads from The Post

It’s Pride Month. Here’s how LGBTQ rights fared around the world this year.

More anti-LGBTQ+ bills passed into state law in the first four months of this year than at any other time in U.S. history, a Washington Post analysis found. Many of these laws focused on transgender rights, and were signed into law either by Republican governors or GOP legislatures that overrode Democratic governors’ vetoes,” Victoria Bisset and Ellen Francis report.

The notorious Russian jail holding U.S. journalist Evan Gershkovich

For decades, Lefortovo prison has been a symbol of oppression and control in Russia, especially for those who dare to challenge power. It is within these walls that American journalist Evan Gershkovich, arrested in March, remains detained, awaiting trial on espionage charges — which he, the White House and Gershkovich’s employer, the Wall Street Journal, strongly deny,” Mary Ilyushina, Francesca Ebel and Júlia Ledur report.

Iran plans to escalate attacks against U.S. troops in Syria, documents show

Iran is arming militants in Syria for a new phase of lethal attacks against U.S. troops in the country, while also working with Russia on a broader strategy to drive Americans from the region, intelligence officials and leaked classified documents say,” Joby Warrick and Evan Hill report.

  • Iran and its allies are building and training forces to use more powerful armor-piercing roadside bombs intended specifically to target U.S. military vehicles and kill U.S. personnel, according to classified intelligence reports obtained by The Washington Post. Such attacks would constitute an escalation of Iran’s long-running campaign of using proxy militias to launch rocket and drone strikes on U.S. forces in Syria.”

… and beyond

Pentagon is blocking U.S. cooperation with international investigations of war crimes in Ukraine

The Pentagon has harbored concerns that cooperation with the International Criminal Court could lead to the prosecution of U.S. troops deployed abroad. The New York Times first reported in March the Pentagon’s reluctance to share information about Ukraine with the ICC,” ABC News’s Dan De Luce and Abigail Williams report.

Millennials are not an exception. They’ve moved to the right.

“This shift toward the right among the young voters who propelled Mr. Obama to victory 15 years ago is part of a larger pattern: Over the last decade, almost every cohort of voters under 50 has shifted toward the right, based on an analysis of thousands of survey interviews archived at the Roper Center,” the NYT’s Nate Cohn reports.

India cuts periodic table and evolution from school textbooks — experts are baffled

“The news that evolution would be cut from the curriculum for students aged 15–16 was widely reported last month, when thousands of people signed a petition in protest. But official guidance has revealed that a chapter on the periodic table will be cut, too, along with other foundational topics such as sources of energy and environmental sustainability,” Dyani Lewis writes for Nature.

  • “Younger learners will no longer be taught certain pollution- and climate-related topics, and there are cuts to biology, chemistry, geography, mathematics and physics subjects for older school students.”

The Biden agenda

Biden shows growing appetite to cross Putin’s red lines

President Biden’s decision last month to help Ukraine obtain F-16 fighter jets marked another crossing of a Russian red line that Vladimir Putin has said would transform the war and draw Washington and Moscow into direct conflict,” John Hudson and Dan Lamothe report.

  • A key reason for brushing aside Putin’s threats, U.S. officials say, is a dynamic that has held since the opening days of the war: Russia’s president has not followed through on promises to punish the West for providing weapons to Ukraine. His bluffing has given U.S. and European leaders some confidence they can continue doing so without severe consequences — but to what extent remains one of the conflict’s most dangerous uncertainties.”

Biden approves a new $300M military aid package for Ukraine

“President Joe Biden has approved a new package of military aid for Ukraine that totals up to $300 million and includes additional munitions for drones and an array of other weapons. It comes as Russia has continued to pummel Ukraine’s capital and unmanned aircraft have targeted Moscow,” the Associated Press’s Aamer Madhani and Lolita C. Baldor report.

Senate advances repeal of Biden’s student debt relief

“A Republican-led effort to overturn President Joe Biden’s student debt relief plan narrowly cleared a key procedural hurdle in the Senate on Wednesday as several moderate Democrats broke with the White House and backed the measure. On a 51-46 vote, the Senate advanced legislation that would repeal Biden’s debt cancellation program and nullify the pause on monthly payments and interest,” Michael Stratford reports.

How the debt ceiling deal vote breaks down, visualized

A bipartisan coalition in the U.S. House passed a bill in a 314-117 vote Wednesday evening to raise the limit of how much money the federal government can borrow to pay its bills for the next two years. The legislation must clear the Senate and become law before Monday — the day the government would default on its debt without an extended borrowing cap,” Kati Perry, Hannah Dormido, Nick Mourtoupalas, Adrian Blanco, N. Kirkpatrick and Kevin Schaul report.

Hot on the left

Can Americans really make a free choice about dying?

In the United States, there is a longstanding tradition of secular opposition to medical aid in dying that’s deeply entwined with disability rights advocacy, but you wouldn’t know that from much of the news coverage. A 2016 piece from USA Today, for instance, broke down the issue and made Pope Francis the sole public figure against medical aid in dying,” the 19th’s Sara Luterman reports.

  • “In reality, the largest and most established disability rights organizations in the United States — the Disability Rights Education and Defense Fund, the American Association of People With Disabilities and the National Council on Independent Living — have all staked positions against medical aid in dying.”

Hot on the right

Nikki Haley slams foreign lobbyists while accepting funds from them

“Despite calling for a ban on foreign lobbying, in which Americans lobby lawmakers and the public for foreign interests, Republican 2024 presidential hopeful Nikki Haley has raised tens of thousands of dollars in political donations from foreign lobbyists, disclosure reports show,” ABC News’s Soo Rin Kim reports.

  • “The U.S. ambassador to the U.N. under the Trump administration, Haley has recently been campaigning on her opposition to foreign lobbying, saying that embassies — and not private consultants or lobbyist agents — should represent foreign interests in the U.S.

Today in Washington

At 4:20 p.m. Biden will leave Colorado Springs for Joint Base Andrews, where he will arrive at 7:40 p.m.

In closing

Happy Pride!

Thanks for reading. See you tomorrow.

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