Weather Damage Turning Into Long-Term Debt for Homeowners: Report

A new report revealed half of U.S. homeowners paid out of pocket for weather damage the past three years, and only 22% feel very financially prepared for an unexpected weather repair, according to tech-native insurance group Hippo Holdings.

Hippo’s third annual “Extreme Weather Report,” based on a survey of 1,047 homeowners across the U.S., also found nearly 80% of homeowners are not financially prepared for an unexpected weather-related repair, lacking either the savings to cover the cost or the ability to complete the work themselves.

Nearly 60% of respondents experienced weather-related home damage the past three years, with half paying out of pocket for it. Nearly 25% of homeowners who paid out of pocket for weather damage are still carrying debt from it. Among those carrying debt, 71% have carried it for at least two years.

The damage wasn’t cheap: 21% paid $2,000 or more, and 9% paid $5,000 or more.

“Protecting a home means protecting the financial future of the people inside it,” said Rick McCathron, president and CEO of Hippo. “When a single weather event can push homeowners into years of debt, the damage extends far beyond the property.”

For the second year in a row, cost is the largest barrier to investing in protective home upgrades that could help mitigate damage, with 39% of homeowners citing it as a top barrier in 2026.

The report found that of the homeowners who experienced damage, 16% delayed contributions to savings or retirement because of it.

Coverage confusion remains a widespread challenge for homeowners, the report found. Thirty-nine percent of homeowners have mistakenly believed damage was covered, and 19% of all respondents paid out of pocket as a result.

More than half (55%) cannot recall their current deductible, leaving many homeowners uncertain about their financial exposure when disaster strikes.

The report also highlighted an opportunity for insurers to play a greater role in weather preparedness.

Despite expertise in property risk, insurance agents are among the two most trusted sources of advice for only 12% of homeowners, trailing local meteorologists at 65% and even friends and family at 31%. While 85% monitor local weather alerts, just 21% reviewed home insurance coverage as a preparedness step in the past 12 months.

“Preparedness shouldn’t start the day a storm is forecasted,” McCathron continued. “Homeowners and insurers both have a role to play before severe weather hits — homeowners in taking preventive steps to protect their properties, and insurers in proactively reaching out to their customers before damage occurs.”