Blue-states already battling an energy affordability crisis appear dead-set on exacerbating the issue. State legislators in California, New York, and Hawaii are mounting new efforts to sue energy companies for rising home insurance premiums, making the spurious argument that companies’ lawful production of energy is to blame.
Expensive and Unrealistic
On the campaign trail, Democratic politicians are touting policies to address affordability concerns. But, according to E&E News reporting this week, the only answer they seem to have for “lowering costs” is to bring more lawsuits scapegoating America’s energy industry.
In New York, a new bill (SB 8585) seeks to expand climate liability by allowing the state’s attorney general to file lawsuits against energy companies on behalf of residents whose home insurance premiums have gone up. Hawaii has already introduced a similar bill and legislators in California are reportedly drafting their own version too. The cost of these bills would be devastating to many homeowners that are already facing an affordability crisis.
Legislators in these states – which already rank among the top 10 least affordable states in the country according to U.S. News and World Report – have proven they would rather drive up energy prices with misguided efforts such as climate litigation and mandated electrification instead of taking real steps to address rising costs. Each New York household would have spent another $2,500 on energy if SB 8585 had been in effect between 2020 and 2024, according to the U.S. Chamber of Commerce.
While these efforts to sue over rising insurance premiums might be new, the playbook, the actors, and their goals are not. For example, the Center for Climate Integrity has been a primary driver of similarly impractical insurance legislation. The same groups, backed by the Rockefellers and foreign billionaires, are trying to impose liability on American energy companies that power our economy by any means possible.
Democrats, Insurance Experts Agree: Insurance Bills Won’t Work
Unsurprisingly, the last time California pursued this misguided approach, it failed. Last April, a similar bill (SB 222) that would have allowed individuals and insurers to sue oil and gas companies over natural disasters stalled in the California Senate Judiciary Committee.
State Senator Anna Caballero (D-14), who noted that she supports strong environmental policy, accurately identified that the bill was not about strengthening the climate at all:
“If this was going to actually result in building homes in the fire zones faster, better and with more efficiency, I would probably support it… But from my view, this is more about lawyers. This is about litigation.”
Similarly, when Hawaii tried to advance a similar bill last year, the Hawaii Insurers Council wrote comments detailing issues with the bill:
“Attributing fault for climate change will be a battle of very expensive specialized experts in a scientific field with no real consensus.”
There are many factors beyond climate impacts that contribute to rising home insurance premiums. These vary state by state, but include the rising cost of building materials, labor costs and shortages, and even how far a home is from a fire hydrant. Pinning rising costs of home insurance on a handful of energy companies is disingenuous lawfare.
Legal Liability “Difficult to Establish”
Even if these insurance bills were passed, the resulting lawsuits would face insurmountable challenges while trying to draw the causal line from individual companies’ energy production, to global greenhouse gas emissions, to localized rising home insurance premiums.
The back-of-the-napkin math activists use to tie global, historic, emissions to individual companies – climate source attribution science – was specifically designed to aid lawsuits, although it’s never been tested in court and faced ample criticism.
As Seren Taylor, vice president for the Personal Insurance Federation of California explains:
“The connection between specific companies’ emissions and specific disasters is complex, making legal liability difficult to establish. This is especially challenging given that emissions cause impacts over decades, exacerbating these attribution challenges. Certainly, it would not be good for policyholders if insurers had to spend tens of millions of dollars on lengthy, losing lawsuits.”
When All Else Fails
After a more than a decade of losing battles to prove so-called ‘climate deception,’ anti-U.S. energy activists are turning to insurance claims as a fallback strategy.
Last fall, lawyers in Washington filed a class action lawsuit to recover money from energy companies after two homeowners’ insurance premiums rose. This is nothing more than a cash grab from lawyers that have a history of questionable behavior. Just last month, Hagens Berman – the firm behind that lawsuit – was referred to the U.S. Department of Justice by a federal judge, citing findings of “misconduct bordering on the criminal” in the firm’s handling of prior cases.
Bottom Line: Instead of addressing real affordability concerns, these legislative efforts are part of a coordinated campaign that seeks to eradicate oil and natural gas companies through litigation, while consumers are left paying the costs.
