Why Is Home Insurance Going Up?

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   Ben Wiedenman

   CSR/Producer, David Schuppler & Associates, Milwaukee, Wisconsin

   There are several different reasons home insurance rates increase.  Most carriers would probably tell you that at least a portion of their increases are linked to weather/natural disaster related claims increases over the past few years.  I often hear from clients in Wisconsin (our location) thinking they should not have to pay more for insurance due to the carrier having more losses from fires out west, or hurricanes on the coast.  Clients say they did not have a claim so why should they pay more?  This debate will rage on but I doubt much will change.  Insurance carriers are a business and when they pay out more in claims, due to bad weather or what have you, they have to make up for the difference; increasing premiums.  They spread risk around to remain competetive, trying to balance out higher risk states/locations with lower risk states/locations.  Average premiums on a state to state level often reflect this (for example, Florida is often ranked number one for premium cost primarily due to the high risk of weather related claims).  Another common reason carriers provide for increasing prmeiums is to keep pace with inflation, many policies offer inflation guard to keep pace with estimated values.  What is the take away here?  Home insurance is WORTH IT!  Protect your home and investment, likely your most expensive one!  Talk to an independent agent today!

   Answered on March 31, 2014

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