Why Did My Homeowners Insurance Premium Go Up?
As an Insurance Agent, this is probably the most frequent question asked, time and time again. "Why has my Homeowners Insurance Premium gone up and I have never put in a claim?" There are many answers to this question. Keep in mind, even though you haven't made any claims, other people have. As an agent, the best advice I can give an insured is, do not make a claim on your Homeowners Insurance until you are sure it was caused by a covered peril and it is well above your Deductible. I cannot tell you how often I see an Insured with a $0 Claim Payout on their Claims Report, that will count against them for years to come, because they did not do a little research before they contacted their Carriers Claims Department and submitted that claim.With that being said, there ARE a lot of claims that do need to be made and the damage was caused by a covered peril. When I say a lot, I mean a lot. Most people think that the majority of claims made in Florida are due to Hurricanes but that is not the case. We have storms roll through on a regular basis that cause considerable damage throughout the state that are not named storms or hurricanes. Not to mention, water damage claims from leaky pipes in the slab, under sinks and hot water heaters. So, even though you haven't made a claim, the carriers are paying out for hundreds of thousands of Insured's that have. When the Carriers payout more than expected, everyone gets a rate increase, including people that are claims free, unfortunately. It's also possible it's due to an increase in your Dwelling Amount on your renewal. Most carriers build in Inflation Guard that increases the Dwelling Amount every renewal. The reason for this is, they are assuming the cost to rebuild or repair will be higher than the year before because materials, cleanup service and labor will be more expensive. When this happens year after year, the Dwelling Amount can become over inflated and well above what it would actually cost to rebuild your home. The Dwelling Amount determines the amount of every coverage on your policy, so when that is increased, so is everything else. If you feel that the Dwelling Amount on your Homeowners Insurance Policy is too high, contact your Agent and ask them to complete a new Replacement Cost Estimator. If it is considerably lower than your current Dwelling Amount, they can submit the RCE to your Insurance Carrier and request that the Dwelling Amount be lowered, along with a signed statement from you, approving the change. Trends in your area may also be to blame. If there are areas that tend to be more prone to burglary, the Carriers will raise the premiums in that area. Insurance companies use advanced analytics to predict the likelihood that you will make a home insurance claim based on where you live. Lastly, some carriers will raise the rates to shed policies. There are times when a carrier may have taken on too many policies and wants to reduce some of their risk. They know by raising the rates considerably, sometimes 50% or more, the Insured's will look for coverage elsewhere. No matter what the reason, if you have found that your Homeowners Insurance Premium has gone up, it never hurts to shop it. As an Independent Insurance Agency, we at State Insurance are able to quote you with MANY carriers to find you the best possible rate. If you would like us to shop your Homeowners Insurance for you, please give us a call today at 904-609-1666.