CHICAGO (NewsNation) — Insurance premiums are increasing nationwide, prompting certain homeowners to take a significant risk: opting to forgo insurance.

This increase is premiums attributed to major companies withdrawing from California and Florida due to the frequent occurrence of natural disasters, especially hurricanes and fires.

“When a home burns down or when multiple homes bun down, that homeowner loses their home,” said Nicole Ganley of the American Property Casualty Insurance Association. “They lose their equity. They lose where they live every day.”

According to Bankrate, the national average home insurance premium based on a $250,000 house increased this year to $1,428 a year — up 20% from 2022.

An Insurance Information Institute survey revealed that 12% of homeowners with an income of less than $40,000 are going without insurance this year.

This trend is partially due to inflation, which has raised the prices of goods, materials, and labor expenses.

According to the Insurance Brokerage Policy Genius, more homes are now at risk of natural disasters than ever before. They cite recent incidences like the destructive flooding in upstate New York, tornados in New England, and wildfires in the Rockies.

However, experts have said there are ways to keep insurance costs down.

“Increase your deductible; have a higher deductible that will lower your monthly costs,” Ganley said. “Also, bundling your insurance your auto and home with one carrier — there’s discounts there.”

Contrary to expectations, relying on government aid to help cover the costs of homes damaged by severe weather is a misconception. The reimbursement for the government falls considerably short of the actual expenses required for reconstruction.

“In 2023, if there is a federal disaster declaration, individual assistance grants will give individuals $41,000 in grant money, but that $41,000 is not going to rebuild the home, I don’t think, anywhere in the country,” Ganley said.

Given the current nature of high insurance premiums, experts advise homeowners to carefully evaluate the potential consequences of being uninsured — a decision that could entail the unsettling prospect of losing their hard-earned accomplishments.