RateReport study documents growths of rates in 2011
Homeinsurance.com, a leading online source for home insurance policies, has released information concerning the state of homeowner’s insurance premiums throughout the U.S. Homeowner’s insurance continues to be an issue that attracts a great deal of attention because of the fluctuations in the housing market and the frequency of natural disasters that have been occurring in the country. The company has released the latest edition of its RateReport study, which investigates approximately 15,000 policies throughout the country sold by companies such as Travelers, Safeco, and The Hartford.
Study shows that consumers are paying more for their home insurance
According to the RateReport study, homeowner’s insurance premiums have jumped by an average of 19% throughout the nation. The report shows that the premiums for new home insurance policies in December 2011 were $810, up from $682 in January of the same year. The company notes that it is not unusual for consumers to be faced with higher insurance premiums, but suggests that the rate at which these increases are being enacted could be experiencing acceleration due to the natural disasters of the past two years.
Natural disasters cited as contributor to higher premiums
Two years of natural disasters have had a tremendous impact on the property/casualty insurance industry in the U.S. These disasters have caused extensive damage throughout the country, leading to massive insured losses that have been difficult for insurers to recover from. In an effort to recover from these losses, insurers have begun to raise rates on coverage. Thus far, rate increases in this industry have been well received by regulators in some states, such as those in Mississippi, Montana, and New Mexico. In these states, new homeowner’s insurance policies have become more expensive.
The trend may continue into the future
Whether the trend will continue is currently unknown. Homeinsurance.com believes that the industry is poised to handle another year of costly disasters, but such activity would likely spur further increases in 2013 and beyond.