New Class Action Links Climate Deception to Rising U.S. Homeowners Insurance Premiums

A newly filed class action lawsuit in the Western District of Washington links rising homeowners' insurance premiums to alleged decades of climate deception by major fossil fuel companies. The complaint highlights that extreme weather events in the U.S. have doubled over fifty years, with catastrophic events in early 2024 generating nearly $145 billion in economic losses, of which about $80 billion were covered by insurance. Plaintiffs, two Washington homeowners, report that their premiums more than doubled and attribute this to misinformation propagated by fossil fuel companies regarding climate risks. The suit alleges that these companies had long-standing knowledge that fossil fuel use would exacerbate climate change and increase catastrophic weather but intentionally misled the public to sustain their product demand, contributing to an insurance premium crisis. Insurers have responded to these climate-linked losses by raising premiums in light of rising frequency and intensity of disasters. The complaint draws parallels with historical litigation against tobacco firms and bases its claims primarily on the Racketeering Influenced and Corrupt Organizations Act (RICO). The plaintiffs represent two classes: a national class of U.S. homeowners with insurance since 2017 and a Washington-specific subclass, both including potential future policyholders. This case marks a novel dimension in climate-related liability by framing insurance market effects as recoverable economic injuries due to alleged corporate deception. The lawsuit could set precedents affecting insurers, fossil fuel companies, and the broader regulatory landscape regarding climate liability and insurance economics. Legal and insurance professionals should monitor developments closely for implications on underwriting, risk management, and compliance strategies.