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What’s Going on With The Cost of Your insurance program

The insurance marketplace is tightening up and it’s happening fast. It’s happening especially fast for home and auto insurance companies. This is regardless of what state you are in. Carriers are pulling a full hard stop on issuing any new policies across the country, and carriers that have NOT put a moratorium on binding new coverage, are actually just leaving the market or they are selling to other carriers/merging. EVERY DAY we are hearing about a pause on new business, or a carrier putting a full stop on writing new policies. Some carriers are requiring full premium payment up front for new business or requiring a 20 to 30 day hold on new applications. Carriers may shift underwriting guidelines, so they only want preferred business… no claims within 5 years (not 3 anymore), home and auto bundles, etc.

The market is disrupted and it WILL affect you. If it hasn’t yet, it will. I have personally seen premiums double and triple what they were the year before.

The cost of claims has risen exponentially in the past 2 years, thus resulting in the carriers having to raise premiums or pull out of some markets.

If you have an auto or home insurance policy, your rates have gone up, and if they haven’t, they will. This isn’t personal, it’s not based on a claim you may or may have not had, it’s simply the cost of doing business.

➡️The cost to rebuild your home is up dramatically due to the rising cost of materials and labor. Supply chain for materials continues to be an issue. We can all agree that everything has gone up in price. Carriers simply can’t survive paying these higher prices without charging more themselves.

➡️The cost to repair your car is up dramatically due to the rising cost of auto parts and labor to fix your car. Replacing a side mirror or windshield used to be $500 – now it’s more than triple that.

➡️The cost of medical care continues to skyrocket.

➡️Litigation is expensive and settlements are rising at an unprecedented rate.

➡️Both the frequency and severity of auto accidents are WAY up post COVID along with the rising frequency of auto fatalities.

This is a significant issue affecting the property & casualty industry, and pricing correction is anticipated at least through 2024.

There are some things you can do to help get through this current insurance market:

✅ Consider Higher Deductibles.

✅ Safe Driving Telematic Programs. Telematics can reward you by giving you a discount for good driving.

✅ Discount Reviews – make sure you’re getting everything you’re entitled to. Every carrier has different discount opportunities. Make sure you go over those with your agent.

✅ DO NOT let your policy cancel or lapse for any reason. Carriers are not reinstating coverage as easily as they once did. If it does cancel, they may require premium in full before reinstating.

✅ Bundle your Auto and Home for more discounts and more stable pricing. Bundled/Packaged policies most always include better coverage and benefits and the cost savings is usually 10-15% (or more) on each policy.

✅ Consider tenure – jumping companies too often will hurt you in the long run. In addition, some carriers won’t take you as a new client if you have less than two years with a carrier. Tenure matters with a carrier.

✅ Follow the laws so you don’t get any tickets. Those tickets really add rate to your policy and stay on your record 3-5 years, depending on the carrier.

✅ Absorb small claims when you’re able, and save coverage for catastrophic losses.