Even if you haven’t submitted a claim recently, you may have had an unpleasant shock when
opening your most recent renewal invoice. As nerve wracking and frustrating as it can be to see
an unexpected uptick in your premium, it’s important to understand what is driving this increase and even more critical to know what you can do about it.
Unfortunately, along with other aspects of our financial world, auto and homeowner’s insurance
rates are being driven higher by many of the same factors. Here are several that are particularly
• Last year, carriers paid more than $20 billion in weather-related losses including
wildfires, tornadoes, hurricanes and flooding, and these were more severe and
widespread than ever before according to the National Centers for Environmental
• Used car prices were up more than 26% in 2021 and construction materials increased
by 18.6% according to the Consumer Price Index released by the U.S. Bureau of Labor
• Widespread labor shortages and supply chain delays led to increased costs for the cars
and homes that are included in the claim while the client’s own property is being
• For the most part, according to the National Highway Safety Administration, driving
patterns are returning to pre-pandemic levels and severity of accidents has increased
with fatal car crashes up nearly 20%.
Since insurance premiums are set to cover future losses, the impact of pandemic fueled
shortages, global warming and economic anxiety means you can anticipate this trend to
continue, at least in the near future.
What can you do to keep your own costs as low as possible while still preserving the protection
you need? Here are a few suggestions that may help:
1. Increase deductibles to the maximum you can afford. That way you’re reserving your coverage for situations that would change your financial plans if you had to pay out of pocket. Every year you don’t have a claim, you’ll be saving money.
2. Look for discounts! Most companies offer bundling and loss-free credits, but ask about loyalty discounts, telematic savings, renovation credits and premium reduction for safety and security features.
3. Don’t submit smaller claims, especially more than one in a three-year period. Doing so can severely affect your current premium and dramatically impact your ability to comparison shop other carriers.
4. Avoid carrier-hopping. While it seems smart to jump from one insurance company to another to save even a small amount, doing so can actually increase your costs overall. Many carriers surcharge their rate if the buyer has been with their prior carrier less than three years. Also, a new home carrier may require immediate repairs that could wipe out any savings.
5.Work with a reputable agency who understands your situation and has access to multiple carriers. That way, when your needs and/or budget changes, you can ask for an insurance review and know you’ll be getting solid options from your trusted advisor, not a high-pressure sales pitch.
At Univest Insurance, we work with nearly 20 regional and national carriers and we’re fully aware of how these challenging trends impact our clients. We strive to make sure you have the coverage you need at the best price point and help you navigate any future decisions, no matter what mother nature or world events bring our way. Now, more than ever, you need an agent who knows you and the market. Call us today at 800-220-3077.
Insurance products offered through Univest Insurance, LLC. are obligations of the issuing insurance companies, not obligations or deposits of or guaranteed by any bank and are not insured by the FDIC or any other agency of the United States.