Catastrophic events are occurring more frequently, leading to substantial financial losses for insurers. For instance, the 2025 California wildfires have resulted in estimated insured losses of up to $50 billion, consuming a significant portion of reinsurers’ catastrophe budgets for the year. Similarly, in Texas, homeowners’ insurance premiums have surged by 43% since 2023, driven by escalating natural disaster-related losses. In high-risk areas, major insurers are withdrawing, leaving homeowners with limited options. In California, companies like State Farm and Allstate have reduced their presence, leading to a surge in demand for surplus line insurers—unregulated carriers that offer less consumer protection and higher premiums. Florida faces a similar situation, with private insurers pulling out and the state-backed Citizens Property Insurance ballooning to cover 1.4 million policies. The convergence of increasing disaster frequency, insurer withdrawals, and rising premiums suggests that the insurance industry is under significant strain. Without substantial reforms and climate mitigation efforts, certain regions may become uninsurable, posing risks to homeowners, lenders, and the broader economy.