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State deputy insurance commissioner briefs committee on rising homeowners insurance costs and reinsurance pressures
Summary
Frank Cote, deputy insurance commissioner, told the House Natural Resources Committee that Montana's homeowners insurance market has lost carriers and seen rising nonrenewals and cancellations; he cited replacement-cost inflation, extreme events and a tighter reinsurance market as drivers and offered consumer guidance.
Frank Cote, deputy insurance commissioner in the State Auditor's (insurance) office, briefed the House Natural Resources Committee on trends in homeowners insurance and how wildfire and catastrophic models affect availability and rates.
Cote said about 70 carriers offered homeowners insurance in Montana in 2023 and that the number of carriers selling homeowners policies dropped by roughly 8% from 2018 to 2023. He said Montana had roughly 408,000 homeowners policies in 2023 and that insurer-initiated nonrenewals and cancellations rose during that period (transcript cited an increase but varying metrics by region). "It's difficult for insurance companies to get reinsurance today," Cote told the committee; he described reinsurance capacity as constrained after repeated loss years, which raises the cost for primary insurers and can reduce willingness to underwrite in areas of concentrated exposure.
Cote attributed part of premium increases to higher replacement costs: he told the committee that building costs had risen substantially, citing personal examples from the field (transcript included contractor estimates ranging widely) and noting those replacement-cost changes feed directly into rate-setting. He also discussed how catastrophic modeling and reinsurer decisions can lead a company to decline or nonrenew policies in particular geographic concentrations.
On consumer guidance, Cote recommended homeowners comparison-shop (considering coverage, not just price), check available discounts (bundling auto and homeowners), verify replacement-cost coverage if they want a full rebuild covered, and consider raising deductibles to lower premiums. He also noted that standard homeowner policies typically do not include flood or earthquake coverage.
Cote offered to provide follow-up details and data and left contact information for the committee (frank.cote@mt.gov). He also recommended that the committee consider bringing in Firewise or state fire-lab experts for deeper technical discussion about mitigation and modeling.
Next steps: Cote said his office can answer follow-up questions and that additional technical witnesses (fire lab, reinsurance experts) could help the committee evaluate policy options affecting insurance availability and rates.
