finance
Rhode Island Legislators Introduce Bill to Restrict Insurers' Fossil Fuel Investments
Two Rhode Island state legislators have introduced the Rhode Island Insurance Market Protection Act to limit insurance companies' investments in new fossil fuel projects and phase out existing ones by 2035. The bill responds to rising home insurance premiums and policy cancellations amid climate change impacts in the state.
Apr 8, 5:55 AM·1m read1 source
The Boston GlobeAudio version
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Rhode Island is experiencing challenges in the home insurance market, with premiums increasing and some residents unable to obtain coverage. Insurance companies have canceled policies, refused renewals, and in certain cases exited the state. The Boston Globe reported that climate change contributes to these issues nationally and locally, leading to higher premiums and non-renewal rates.
In Rhode Island, climate change effects include the 2023 brush fire in Exeter, the state's largest wildfire since 1942. Intense storms have caused coastal flooding, erosion, and wind damage, while rising sea levels threaten homes. These events result in more frequent and severe disasters, increasing insurance claims.
Industry Practices Insurers have passed increased costs to customers through higher premiums or by exiting markets to maintain profitability.
US insurers hold investments in fossil fuels exceeding $500 billion. The Boston Globe reported that property casualty insurers recorded profits of $169 billion in 2024. State Representatives Jennifer Boylan, representing District 66 in Barrington and East Providence, and State Senator Dawn Euer, representing District 13 in Newport and Jamestown, introduced the Rhode Island Insurance Market Protection Act, designated as 2026-H 8219 and 2026-S 2646.
The legislation aims to address these market challenges by restricting insurers' involvement in fossil fuel projects.
the Act The act would prohibit insurance companies from investing in new fossil fuel projects and require phasing out investments and coverage for existing projects by 2035.
Companies must submit annual compliance reports, with non-compliance risking loss of state licenses. Penalties and restrictions would apply to firms that fail to comply or attempt to leave the state to avoid these requirements. The bill seeks to stabilize property insurance rates and support Rhode Island's economic well-being by addressing climate-related risks.
