If you have received your renewal policy and the cost of your coverage has increased, you are not alone. No doubt you have seen your grocery bill increase with inflation, but that’s only part of the issue with regards to insurance.
Premium Pricing:
Premium price is a balance between being competitive enough to win business in the market, while safe enough that the money brought in exceeds the losses incurred plus business expenses. Insurance companies across the country finished their year in the red in 2023.
The imbalance of losses (plus expenses) incurred, and premiums charged in 2023, have caused insurance companies to react feverishly this year. Catastrophic claims from natural disasters breached the billions last year and inflationary conditions continue unfavorably.
Property and Auto are the most impacted coverage types by the recoil of the 2023 performance and factoring of continued inflation. Unfortunately, that means personal lines have been particularly hit hard. Companies have raised rates to factor in the increased cost of labor and materials for repairs. Additionally, it is known that higher numbers of claims are likely as our economy drags and applies pressure to its constituents.
Ebb and Flow of Insurance Market:
The insurance market does ebb and flow with our economy and pricing goes up and down, with a general upward trend. While it is possible to shop and drop rates, it is critical that the quality of coverage is reviewed and sustained.
As an independent agency it is our job, year after year, to address the changing market and ensure the best placement for our clients. When the market gets tough, we extend our Carrier portfolio and seek out additional solutions as needed.
Photo Credit: The Constructor. “How Does Hike in Interest Rate Affect Construction Industry?” <https://theconstructor.org>
