Homeowners insurance trends show claims and losses are falling
A LexisNexis report has found that home carriers are riding a positive wave at the moment.
LexisNexis has released a report saying that homeowners insurance trends are good for providers right now. The claims are decreasing while the loss costs have been either falling or remaining flat.
This U.S. insight was published in the 2016 LexisNexis Home Trends Report.
The homeowners insurance trends report took into account that there was only one major hurricane this year in the United States. Moreover there was a decline of 30 percent from 2010 through 2015 in overall loss in all forms of peril. That was credited primarily to a reduced number of catastrophic events and a lower number of claims.
The LexisNexis study also determined that while there was a 46 percent jump in the number of claims during the spring, claim severity appears to keep a steady path during the remainder of the year.
The homeowners insurance trends toward the highest costs were in the Midwestern states.
Peril claims bringing in the highest loss costs were in the “Tornado Alley” portion of the Midwest. That said, throughout that region it is actually hail that produces the most damage within those states, according to the report.
LexisNexis Risk Solutions senior director of home insurance, George Hosfeld said the firm’s report provides helpful insight to homeowners insurance companies. He pointed out that the data can be used for improved property assessment and more accurate pricing.
The report’s findings also broke down the figures by peril:
• Hail – there was a 26 percent decline in loss cost during the period of 2010 through 2015 due to hail damage. That said, this last spring and summer, there was a 50 percent increase in hail claims, making it the second main reason for loss costs from April through June.
• Wind – Over the same five year period, catastrophic wind events fell by 20 percent and their loss cost fell by 53 percent.
Other homeowners insurance trends for perils taken into account were fire (which declined), water (which remained steady), theft (which fell), as well as liability (which dropped).