Should Americans Pay for Insurance Risk in Disaster-Prone States?

Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources.
More frequent and more destructive natural disasters are shaking the foundation of the U.S. homeowners insurance systems, with coverage becoming more costly and harder to procure for millions of Americans.
In vulnerable states like California and Florida, where insurers face higher costs and catastrophe exposure, many companies have drastically cut coverage over the past few years, fearing they might not be able to pay the enormous claims generally linked to extreme events.
The solution to the struggle faced by these states might have to be a radical one, according to some experts, such as centralizing the insurance system at the federal level—even if it’s likely so unpopular that it would take a cross-states disaster to make it palatable.
A Problem That’s Only Going to Get Worse
Since 1980, the U.S. has been hit by 403 weather and climate-related disasters, according to data from the National Centers for Environmental Information (NCEI),causing an estimated total of more than $2.917 trillion in damages and 16,918 deaths.
Each of the past four decades saw the number of extreme events increasing: in the 1980s, there were a total of 33 natural disasters causing an overall $219.6 billion in damages; in the 1990s, there were 57, costing $335.3 billion; the 2000s reported 67 natural disasters, for a total cost of $621.3 billion; and in the 2010s, there were 131 extreme events costing a total of $994.6 billion.
The frequency and severity of natural disasters is accelerating fast. In the last five years alone, the country was struck by 115 catastrophic events that caused total damage of $745.7 billion.
In disaster-prone states like California and Florida, pricing risk accurately and reflecting the risk with higher premiums has already become a problem for insurers. Some experts fear that, unless important reform is implemented, high-risk areas of these states might eventually become uninsurable.
How Would a National System Work?
One radical solution to the U.S. insurance crisis could be to have a federal insurance system aggregating risk at the national level instead of having state insurance regulators, Steven Haynes, assistant professor of Practice, Finance and Managerial Economics at the University of Texas at Dallas, told Newsweek.