How California Wildfires Are Raising Your Home Insurance Rates in Tennessee
If you’re a Tennessee homeowner wondering why your insurance premium has jumped in the last couple of years even if you haven’t filed a claim… you’re not alone. Let’s break down what’s going on, why it matters to you, and what you can do about it.
Large insurance carriers spread their risk across multiple states. So when disasters like wildfires in California or hurricanes in Florida cause billions in damage, the financial impact hits the entire insurance system. In fact, a Harvard study found that insurers often increase premiums more in states with fewer pricing restrictions after a big disaster elsewhere. So while we’re not dealing with wildfires here, we’re still feeling the heat.
The Hidden Layer: Reinsurance
Here’s something most people don’t usually talk about: reinsurance. That’s basically insurance for insurance companies. When massive disasters strike, like the wildfires we’ve seen in California, insurers rely on reinsurance companies to help cover those huge losses.
But when reinsurers take a hit, they raise their prices too — and insurance companies pass that cost along to you.
In 2023, reinsurance costs spiked by 20% to 50%, the biggest increase since Hurricane Katrina. That ripple effect lands on your desk in the form of higher premiums, even if you’ve never filed a claim.
What’s Happening Here in Tennessee?
Tennessee hasn’t been immune to its own weather events — think hailstorms, tornadoes, and flash flooding. But even if we set that aside, premiums are still rising higher than most think they should.
The average homeowners insurance premium in Tennessee is now over $2,000 per year — around 20% higher than the national average. Some folks are seeing 20–30% jumps at renewal, even with clean claim histories. We have seen premiums go up 27% — without making a single claim.
Why? Because your premium isn’t just about your home. It’s also covering part of the national and global cost of disasters.
Climate Risk = Long-Term Pressure
With climate change driving more intense and frequent disasters, insurance companies are adjusting how they price risk. They’re no longer just looking backward at historical data — they’re using predictive models that factor in future climate projections. That means we can expect elevated premiums for years to come, even in states like Tennessee that aren’t considered disaster zones.
One major reinsurer, Swiss Re, projects home insurance premiums could keep rising 5%+ per year through 2040 due to climate-related losses.
So yeah… this is a trend, not a blip.
What Can You Do About It?
Okay, so what can you actually do as a homeowner in Tennessee?
Review Your Policy Annually – Make sure your coverage is accurate and your dwelling limit reflects today’s rebuilding costs. Don’t just let it auto-renew without checking.
Look for Ways to Save – Things like bundling your auto and home, upgrading your roof, or adding smart home devices can help lower your premium.
Talk to a Local Agent – Work with someone who understands what’s happening both nationally and locally. They might be able to find you better options or spot discounts you’re missing.
Ask About Deductible Options – Sometimes increasing your deductible slightly can bring down your monthly premium, just make sure you’re comfortable with that risk.
Final Thoughts
It’s easy to feel frustrated when your insurance rate goes up for reasons that seem totally out of your control. But understanding the bigger picture — and how wildfires in California are part of it — can help you make smarter decisions.
At the end of the day, insurance companies are trying to keep up with a world that’s changing fast. And whether we like it or not, homeowners in Tennessee are now part of a much bigger insurance equation.
Need help making sense of your policy or want to explore other options? Reach out — we’re here to help.
