Missouri residents can expect to see higher rates for their homeowners insurance in the coming months thanks to the major disaster that struck the town of Joplin early last year. On May 22, 2011, a massive tornado rolled through Joplin, causing unprecedented damage throughout the town causing many businesses to shut down and leaving nearly a third of the town uninhabitable. The tornado cost the state millions of dollars in insured losses, and now insurers are looking to recovery some of that money.
Several insurers have proposed rate hikes between 4-6% in much of the state, especially in Joplin. Insurers have been looking to raise rates in the state in the wake of the disaster, but delayed their pursuit of rate hikes so those affected by the disaster would have some time to recover financially. Nearly eight months after the catastrophe, insurers are now keen to recover from their losses and have pressured state regulators to grant approval to their rate proposals.
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The Joplin tornado is not the only event that is contributing to rising insurance rates. 2011 was a infamously active year in terms of natural disasters. Between April and June, more than 600 tornados were recorded in the U.S. Some of these disasters caused significant damage while others were mild. Each of these events added to the monumental insured losses faced by the insurance industry today. Regulators have yet to say whether they will approve the rate proposals.
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