Why are my insurance rates going up?
Another year has passed, you have not gotten in any accidents and you have not filed any home claims. You get your insurance renewal in the mail and your rates have increased? Why is it that without any losses, your rates still seem to be going up? The insurance professionals of American Advantage – Petersen Group in New Berlin, Wisconsin explain what causes rates increases:
Shared Risk: The foundation of insurance is that risks are shared among a large group of people. Premiums are distributed among many as well losses. Although, you may not have had a loss, others do. This is a major factor to general rate increases.
Changes in Credit Score: Insurance prices rely heavily on credit score. If there has been a significant decrease in credit score, you will see an increase in your premiums.
Record Storms: Natural disasters and storms are hitting record levels and losses are becoming more and more severe. This leads to insurance companies paying out more in claims, and due to shared risk, premiums increase among all.
Lawsuits: It seems as if you cannot turn the TV on without seeing a personal injury attorney commercial. Lawsuits are becoming more severe and increasing drastically in payout from insurance companies.
Cost of Materials: With how sophisticated vehicles have become with sensors and other features, the cost to replace them have significantly increased. In the past to repair a bumper it cost approximately $1,000, but today it is upwards of $4,000. The rise in the cost of materials is one of the main factors for rising auto insurance rates. The same goes for home building materials.
Age: The age of your roof plays a factor in your insurance premium. If your roof hits 20 years or over, there will be a rise in premium. Also, many people do not realize but once a person reaches 70 years old, there will be an increase in price.
Right now, insurance premiums are trending to increase by 5-10% each year. To keep insurance premiums low, work with an independent insurance agent like those at American Advantage – Petersen Group in New Berlin, Wisconsin. An independent insurance agent works with multiple, reputable insurance companies to find you the best coverage at a competitive price!