Explaining increases in your homeowners insurance.
If you are approaching the renewal period for your homeowners insurance policy, then your agent will provide a report that details your current coverage and any premium changes. When reviewing this report, you may notice that your rates are increasing. But what causes your premiums to go up? Well, in addition to things like filing more claims and raising your coverage limits, your premiums are affected by outside factors as well. Here are some of the unexpected things that can result in home insurance rate increases.
- Increasing Likelihood of Extreme Weather Events
In recent years, the number of wildfires, windstorms, hurricanes, tornadoes, and other extreme weather events have increased significantly. As the frequency of these damaging events increases, insurance companies must increase their rates so they can keep up with resulting home insurance claims.
- Increasing Local Crime Rates
When calculating your premiums, your home insurance provider will look at the local crime rate to determine how likely you are to become a victim of theft or vandalism. If your local crime rate has increased over the past year, then your insurer will consider you a higher risk to insure. To offset this risk, they will increase your premiums.
- Increasing Cost of Repairs and Replacements
As the cost of emergency cleanup services, skilled trades, personal belongings, and home values increase, so does the amount of money insurance companies have to pay to address policyholder claims. Insurance companies will increase policy premiums to offset the higher cost of claims.
These are some of the reasons why your home insurance premiums may have gone up. Do you have further questions about your home coverage? For assistance with all your coverage needs, contact an insurance professional at Westwood Insurance Agency today.