US Cities That May Soon Become Too Risky to Insure

By Sam Stebbins  •  April 24, 2026
A scenic view of a cozy bungalow illuminated at dusk, nestled in lush greenery.
Photo by Sebastian Sørensen on Pexels

To protect themselves from financial losses in the event of theft or damage, the vast majority of American homeowners have insurance policies on their property. But, like any other company, insurance providers are in business to make money – and as climate change is increasing the frequency and intensity of natural disasters, insurance is becoming an unprofitable business in many parts of the country.

In the American West, wildfires consume millions of acres every year, often destroying entire communities. Similarly, hurricane winds and storm surges have caused hundreds of billions of dollars worth of property damage in states along the Atlantic and Gulf coasts in the last few years alone. In the wake of these disasters, rebuilding is funded largely by insurance companies.

Often, the only way insurance providers can remain profitable in higher-risk areas is by raising customer premiums or simply denying coverage. In 2022 alone, there were over 2,400 U.S. ZIP codes in which insurance providers paid out more in claim settlements than they brought in through premium revenues. While insurance company losses in these areas are offset by more profitable parts of the country, insurers may decide covering communities where losses are especially severe is no longer in their best interest.

Using data from the Treasury Department, Climate Crisis 247 identified the communities where insurance companies are losing the most. We reviewed data for over 25,500 U.S. ZIP codes and ranked them on their insurance loss ratio – or the amount insurers paid out to claimants as a share of revenue from policy-holder premium payments. Treasury Department data is current as of 2022, and only includes ZIP codes with at least 10 insurers and where at least 50 homeowner insurance policies have been issued. Only ZIP codes in which loss ratios were at least 1,500% are included on this list.

It is important to note that insurance company losses in the cities and towns on this list are not necessarily attributable to climate-related natural disasters. Still, the highest ranking places on this list, where claim payments exceeded premium revenues many times over, suffered through catastrophic wildfires in 2022 – including the McKinney, Caldor, and Calf Canyon/Hermits Peak fires, which destroyed communities in parts of California and New Mexico.

15. Elco, PA (ZIP code: 15434)

  • Insurer loss ratio (claims paid-out as share of premiums received): 1,858%
  • Avg. insurance claim pay out in 2022: $22,799
  • Avg. premium payment per policy holder in 2022: $839

14. Greenville, CA (ZIP code: 95947)

  • Insurer loss ratio (claims paid-out as share of premiums received): 2,067%
  • Avg. insurance claim pay out in 2022: $96,392
  • Avg. premium payment per policy holder in 2022: $2,663

13. Carbon, TX (ZIP code: 76435)

  • Insurer loss ratio (claims paid-out as share of premiums received): 2,197%
  • Avg. insurance claim pay out in 2022: $76,809
  • Avg. premium payment per policy holder in 2022: $2,364

12. Gates, OR (ZIP code: 97346)

  • Insurer loss ratio (claims paid-out as share of premiums received): 2,479%
  • Avg. insurance claim pay out in 2022: $207,686
  • Avg. premium payment per policy holder in 2022: $1,227
a river running through a valley
Photo by Manny Becerra on Unsplash

11. Berry Creek, CA (ZIP code: 95916)

  • Insurer loss ratio (claims paid-out as share of premiums received): 2,640%
  • Avg. insurance claim pay out in 2022: $140,098
  • Avg. premium payment per policy holder in 2022: $2,131

10. Mora, NM (ZIP code: 87732)

  • Insurer loss ratio (claims paid-out as share of premiums received): 2,899%
  • Avg. insurance claim pay out in 2022: $83,853
  • Avg. premium payment per policy holder in 2022: $1,720

9. Wallowa, OR (ZIP code: 97885)

  • Insurer loss ratio (claims paid-out as share of premiums received): 3,003%
  • Avg. insurance claim pay out in 2022: $45,660
  • Avg. premium payment per policy holder in 2022: $1,345

8. Louisville, CO (ZIP code: 80027)

  • Insurer loss ratio (claims paid-out as share of premiums received): 3,024%
  • Avg. insurance claim pay out in 2022: $145,705
  • Avg. premium payment per policy holder in 2022: $3,193

7. Paradise, CA (ZIP code: 95969)

  • Insurer loss ratio (claims paid-out as share of premiums received): 3,361%
  • Avg. insurance claim pay out in 2022: $33,335
  • Avg. premium payment per policy holder in 2022: $1,851

6. Sapello, NM (ZIP code: 87745)

  • Insurer loss ratio (claims paid-out as share of premiums received): 3,516%
  • Avg. insurance claim pay out in 2022: $100,703
  • Avg. premium payment per policy holder in 2022: $2,061

5. Detroit, OR (ZIP code: 97342)

  • Insurer loss ratio (claims paid-out as share of premiums received): 3,853%
  • Avg. insurance claim pay out in 2022: $226,129
  • Avg. premium payment per policy holder in 2022: $997

4. Vida, OR (ZIP code: 97488)

  • Insurer loss ratio (claims paid-out as share of premiums received): 4,485%
  • Avg. insurance claim pay out in 2022: $211,986
  • Avg. premium payment per policy holder in 2022: $1,539
the sun is setting over the mountains in the desert
Photo by Davron Bowman on Unsplash

3. Rociada, NM (ZIP code: 87742)

  • Insurer loss ratio (claims paid-out as share of premiums received): 6,559%
  • Avg. insurance claim pay out in 2022: $150,891
  • Avg. premium payment per policy holder in 2022: $2,557

2. Grizzly Flats, CA (ZIP code: 95636)

  • Insurer loss ratio (claims paid-out as share of premiums received): 6,839%
  • Avg. insurance claim pay out in 2022: $169,786
  • Avg. premium payment per policy holder in 2022: $1,685

1. Klamath River, CA (ZIP code: 96050)

  • Insurer loss ratio (claims paid-out as share of premiums received): 8,372%
  • Avg. insurance claim pay out in 2022: $528,482
  • Avg. premium payment per policy holder in 2022: $2,889


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