submitted by Rick Meyers, AAA Insurance Holland/Nichole Meyers, cluballiance.aaa.com/Agent/NicholeMeyers
Receive your auto or home insurance bill and see a 10-30% increase? You are not alone. Many are wondering why their premiums are on the rise and what steps they can take to mitigate the impact on their wallets. Let’s delve into the factors contributing to this surge and explore strategies for consumers to navigate this challenging landscape.
Why the Increase? Spikes in claim costs can be attributed to more frequent weather events, costlier building materials, labor price increase, technological advancements enhancing safety features which subsequently lead to higher repair costs, as well as increased litigation.
According to Kelley Blue Book at the start of the past decade, average new car prices increased by less than 3% annually until the onset of Covid-19. Between 2019 and 2020, prices rose by 5%. This increase escalated dramatically, with a spike of 17.2% between 2020 and 2021, followed by another rise of 11.8% in 2022. As a result, the average cost of a new car now stands at $49,388, reflecting a roughly 60% increase over the last decade.
Over the past five years, home insurance claims have surged significantly, with a 33% increase in large fire damage restoration, a 46% increase in roof repair due to wind and hail damage, and a 50% increase in non-weather-related plumbing repair.
These claim payouts are causing carriers to adjust their products and underwriting to stay profitable
What Can Consumers Do? Shop around, bundle policies, review coverage limits and deductibles while not sacrificing coverage, take advantage of all discounts. Consider Nichole Meyers of AAA Holland, an independent agent who can compare rates from multiple insurers to ensure you are getting the best value for your coverage.
While the increase in personal auto and home insurance rates may pose challenges for consumers, understanding the factors driving these changes can empower individuals to make informed decisions about their coverage. By exploring different insurance options, optimizing coverage, and taking advantage of available discounts, consumers can navigate the rising insurance landscape while protecting their assets and finances. Stay vigilant, stay informed, and remember that proactive measures can help mitigate the impact of increasing insurance rates.
Phone 215-485-5491.