Southeastern states confront severe weather and increased rates in 2025

The Southeastern region of the U.S., encompassing Alabama, Georgia, Kentucky, Mississippi, and Tennessee, is known for its charming small towns, music hot spots like Muscle Shoals, and vibrant cities like Atlanta and Nashville, as well as thru-hiking along the Appalachian Trail and the purple-blue backdrop of the Great Smoky Mountains. With a relatively low cost of living, mild climate, rambling trails, nightlife, and ample opportunities to plug into live music from blues to country, the Southeast is a star of our country.

“Rainy night” in Georgia and the Southeast

The insurance landscape in the Southeast is dynamic and responsive to threats from extreme weather, like tornadoes, hurricanes, floods, severe storms, and winter storms.

Tornadoes and severe storms 

In 2024, there were 27 severe storms in this region. One storm in Alabama was a rare derecho event that caused winds of over 100 mph and $1.6 billion in costs. Meanwhile, Georgia experienced an outbreak of more than 79 tornadoes, costing $2.4 billion in damages due to high winds and hail. 

Hurricanes and tropical cyclones

In 2024, Category 4 Hurricane Helene, with winds of 140 mph, caused significant damage in the Southeast, including to Georgia’s agricultural sectors, while Hurricane Francine produced heavy rainfall of up to nine inches in Muscle Shoals, Alabama, and Hurricane Debby caused flooding in parts of coastal Georgia. By state, the cost associated with hurricanes and cyclones in Alabama was between $500 million and $1 billion, in Georgia between $10 billion and $20 billion, and in the states of Kentucky, Mississippi, and Tennessee, around $5 billion in total associated costs for the combined events.

Floods

Georgia saw intense flooding in 2023 as part of a storm that hit the East Coast and caused $1.3 billion in costs. Meanwhile, Eastern Kentucky was overwhelmed with five to ten inches of rainfall and flash flooding in 2022, causing approximately $1.6 billion in damages.

Winter storms

The Southeast experienced a powerful Arctic front in 2022 that caused some $9 billion in estimated costs to repair issues like frozen pipes and associated water damage. Georgia, Mississippi, and Tennessee also saw a cold front in January 2024 that produced high winds, freezing sleet, and damage to homes and vehicles.

Rising waters and rising rates

Analysis found that these Southeastern states are at risk of insurance rate hikes or potential nonrenewal due to the increase in natural disasters in the region. One homeowner in Tennessee says their homeowners insurance jumped up by 27% in 2025, a fact likely attributed to the storms and tornadoes that hit the state and Kentucky. Southern parts of Georgia and Alabama are at higher risk for high-wind events and hurricanes, and these areas may find the market increasingly hard.

Further complicating matters is the rise in mega awards—in excess of $10 million—in jury verdicts. These types of awards are known as nuclear verdicts, and Georgia is among the top ten states in the nation with the highest prevalence of these awards. “The prospect of a nuclear verdict makes it more difficult to fairly resolve claims, leading to unnecessary litigation and appeals,” according to the Institute for Legal Reform. Additionally, these nuclear verdicts can create insurability problems and drive up costs for policyholders. In Georgia, on a per capita basis, nuclear verdicts are on the rise in the state. 

However, the mounting cost of claims signals that the Southeastern homeowners’ insurance market remains a hard market, meaning there is an increase in prices and a decrease in insurance product availability. Both of these factors make it harder for homeowners in Alabama, Georgia, Kentucky, Mississippi, and Tennessee to find the coverage they need.

Car insurance rates experienced a moderate climb in 2025; however, none of the Southeastern states made it into the top ten lists of the most expensive. Catastrophic weather events could impact those rates in the coming years, and can drive reliance on the excess and surplus lines market driving up rates which is what happened in 2024.

Further complicating matters, is the fact that after natural disasters, there is often a rise in fraud. Georgia tops the list for fraud claims in America. In 2023, there were 1,564 fraud reports per 100,000 residents in and more than 166,299 cases of fraud filed. Tennessee and Alabama were also listed alongside Georgia as the most scammed states in America. Common types of fraud involve identity theft, credit card fraud, phishing scams and insurance fraud, where claims are exaggerated to result in higher payouts.

Risk mitigation strategies for the Southeast

Residents in the Southeast can take action to make their homes more resilient in the face of severe storms, hurricanes, floods, and winter storm events.

• Update your roof to a Class 4-rated material, as it is better suited to withstand hailstorms. Ensure strong roof-to-wall attachments, and update windows and exterior doors to impact-rated products. These actions can go a long way in protecting a home during hurricanes, tornadoes, high-wind events, and hailstorms.
• Prepare for winter storms by investing in a backup generator and/or a low-temperature monitoring system. If the temperature inside your home falls below a pre-set threshold of your choice, your alarm system will alert you. Additionally, you should maintain your HVAC—heating and cooling system—as it is vital during cold weather events.
• If you own property near the coast or in flood-prone areas, you may want to consider lifting your home above base elevation to prevent future flood damage. Homes can also be updated to include floodproof doors and windows, and specialty products can be considered as options to deploy once flooding begins.

For more details on this and other mitigation strategies, review our risk mitigation tips and connect with our risk advisory team to design a customized plan for your property.

Southeastern states introduce strong legislation

Alabama:

The state introduced a program called Strengthen Alabama Homes, which offers small grants to reinforce roofs, improve wind resistance, and help homeowners protect their properties from severe weather.

Georgia: 

Governor Brian Kemp of Georgia has proposed tort reform measures in response to rising insurance rates and challenges related to insurability within the state. An analysis of data commissioned by House Bill 1114 examines Georgia’s insurance landscape, indicating that the frequency, severity, and legal involvement in insurance claims are rapidly rising. Year over year, the severity of claims and the number of large losses over $1 million have consistently increased, and most of the liability claims relate to private passenger auto liability. Additionally, Georgia is considering imposing lawsuit award limits due to the rise of nuclear verdicts surpassing $10 million in the state.

Kentucky:

House Bill 256 encourages better construction of homes and the use of fortified roofs built to withstand wind and hail damage.

Mississippi:

At the start of their session, legislators introduced House Bill 1534 to establish the Mississippi Windstorm Mitigation Association and promote more resilient homes and commercial properties.

Tennessee:

Similar to Mississippi, Tennessee legislators have sought to help strengthen buildings and create communities more able to withstand extreme events via the Promoting Resilient Buildings Act.

Working with a broker

Clients faced with the challenges of a hard market often benefit from the expertise provided by a professional insurance advisor who works with multiple insurance companies and can provide counsel and advocacy.

Before filing a claim, be sure to speak with your insurance broker. A comprehensive 2025 report showed that homeowners insurance is more costly and harder to procure now due to the cost associated with climatic events. These rising costs and the difficulty of obtaining insurance mean homeowners need to be strategic when filing claims, so as not to be dropped from a policy prematurely.

Whether you are buying a new home or looking for new coverage after a nonrenewal, schedule an insurance review with a Personal Risk Advisor to learn more and obtain expert advice tailored to your needs, allowing you to make informed decisions regarding your insurance coverage.