The Perfect Storm, important information on rising insurance rates

By: Advocate Brokerage

rising insurance rates

It’s no secret that Insurance premiums have been rising throughout the country. We understand how frustrating these rate increases are and we want you to know that we are working behind the scenes to ensure that we find you the most cost-effective policy that doesn’t sacrifice your coverage. The information contained in this blog will hopefully help you to gain some understanding as to the changes that have occurred across the insurance industry and may have affected your insurance rates.

These Are The Factors That Contribute To Rising Insurance Rates:

Acute Inflation

Inflation continues to be an issue. In 2022 US inflation hit a 41-year high at 8%. Nearly every industry is feeling the effects of this historic inflation. Housing prices, construction materials, trade services, medical services, and automobile parts, all cost more than they did a year ago.

Increased Frequency Of Severe Weather

Last year (2022) marked the eighth year in a row that the United States suffered at least ten natural disasters causing over $1 Billion in losses.

Legal System Abuse

The AVERAGE jury award reached a record high of $2.5 million in 2020. In New York State more than 1 in 5 personal injury accidents result in a lawsuit. This is one of the main factors driving the increase in auto insurance rates

Supply Chain Issues

Disruptions in the supply chain continue and have made it more difficult to obtain a variety of items from semiconductor chips for modern automobiles, to basic parts needed for auto repair, to windows or doors needed to complete the construction or restoration of a home. As a result, the costs for these materials are on the rise.

Historic Cost Of Reinsurance

Insurance companies insure themselves by buying reinsurance. Reinsurance offers protection by making sure insurance carriers remain financially solvent. Reinsurance rates increased an average of 37% over last year and as a result, many carriers have no choice but to pass these increases onto those they insure.


What Can You Do To Keep Your Premium As Low As Possible?

Increase your deductible

One option is keeping premiums low is to increase your deductible. We would be happy to talk you through your options.

Be proactive to prevent future claims

For homeowners’ insurance, for example, adding features such as a water shut-off alarm, fire suppression sprinklers or a whole-house generator can help.

Stick with your current carrier  

Loyalty is always rewarded in the long run. Even though it may be tempting to make a switch to save money, you are usually better off staying with your current carrier.

Carefully Consider Each Claim You File 

Only file larger claims because multiple, small claims cost you in the long run.

Make your payments on time

If you have not already done so we recommend you set up automatic payments to reduce the possibility of missing or delaying a payment on your policy.

We understand that no one wants an insurance rate increase. We do our best to recommend coverage that truly has your best interest at heart so that in the event of a loss, you won’t be left without adequate coverage. After all, we always strive to offer insurance that’s personal. We are always available to answer questions and to help in any way we can, you can get in touch with us at 914-723-7100.

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