We have been talking about this all year, but it is an important change that you as a homeowner need to know. Due to the increased costs for nearly everything in our country right now, we are seeing changes to insurance policies as well as our other essentials in our lives.
One of the main factors on your homeowners insurance policy is the Dwelling Coverage (Coverage A). Also known as the Reconstruction Cost, it is what the insurance company will pay out in the event of a total loss of your home to get it completely rebuilt. It also covers if the home is damaged to get everything fixed, but the main consideration is when a total loss occurs.
Due to increased material and labor rates, I have personally seen the Dwelling coverage increase by nearly $100,000 on a policy for a higher value home which caused a 30% increase on the policy at renewal.
While the Dwelling coverage is not the only factor in increasing rates, it is the largest. Insurance companies across the board have had a high number of claims over the last year with more bad weather causing more damage. So insurance companies also take their losses into consideration when determining their rates.
There are a huge number of factors that go into getting insurance rates that include: Your personal insurance score, claims history, credit score, to the statewide losses, specific zip code data, probability of loss by area and individual information, etc.
Insurance is based on risk pools. And those pools are split into different segments (Auto and Home, Specialty Policies, Commercial, etc.) to try and keep rates as stable as possible while also looking at historical data to make the best prediction on losses and potential claims payouts.
This seems like nothing but doom and gloom and I promise you it is not. But it is important to understand HOW insurance companies get their rating scores so you as the consumer know what to look for and to ask your agent for your policies.
,I found a great article by Farmers Insurance to help go into a little more detail on the increasing homeowners insurance rates that I wanted to share with you. I did not write this article and take no credit for anything within it. But it does have some great details that I thought would be beneficial and my job as a Licensed Insurance Agent and Advisor is to try and spread as much information as I can so you are able to make the best decision for your family's protection.
As a homeowner, you have options. From doing a policy review with your current agent and making sure the specifications of your home are listed correctly to maximizing all the discounts offered can add up to hundreds of dollars or more in savings each year.
And if you would like a free, no obligation review of your current policy feel free to visit app.usecanopy.com/c/stephenturner, stop by in person, or give us a call at 678-719-0678 and we will gladly assist.
Lastly, if you or someone you know is purchasing or re-financing a home then it is the perfect time to see what your options are and ensure that your most valuable asset has the right protection and the right agent for your specific needs!
This blog will have articles written by members of the Stephen Turner Agency as well as other relevant articles we find. We want to ensure you have the most up to date info on the insurance industry so you can make the best choices for your family!