The Insurance industry is experiencing another year of increased insurance premiums. Why? Below is some information to help you understand what is going on within the insurance industry.
The cost of insurance is influenced by many varied factors. Details like the increased costs to repair damaged vehicles, increased instances of insurance fraud, and rising medical and rehabilitation costs for accident victims all play a role in the determination of your insurance premiums. In the past few years:
- The number of Collision claims, and cost to repair or replace vehicles has been increasing over 10% annually.
- Costs associated with Accident Benefits claims have been increasing 14% annually.
- Overall claims costs were up to 50% higher in 2000 than they were in 1999.
- The Investment Income on premiums collected by Insurance Companies has decreased drastically. (You will have experienced this in your own personal finances).
While the insurance industry has implemented cost-savings measures to try to control some of these issues, many of these factors are beyond industry control. Like all businesses, Insurance Companies need to try to maintain profitability. An unprofitable company cannot compete in any market place. If Insurance Companies cannot stay in business, then the number of competing Insurance markets is reduced and the effect on the insurance consumer is the elimination of choice and competitive pricing. In light of these factors, Insurance companies have increased the premiums they charge to the consumer in order to try to remain profitable. As a result, even if you have not had a loss or claim against your policy, your insurance premium will likely go up.
There are some things you can do to help offset these increases:
- If you have more than one vehicle insured with the same company, but on a separate policy, you could qualify for a Multi-vehicle Discount.
- If you insure both your Home and Automobile insurance policies with the same company, you could qualify for a Multi-Policy Discount.
- Additional savings can be obtained through Higher Deductible limits.
- If you have a child away at College or University, and that child does not have the use of your vehicles, you may be entitled to a Discount of 15%-50% on the premium you pay for the Occasional Driver coverage for that child.
- If you have a monitored home alarm system you may qualify for an Alarm Discount on your home insurance premium.
As your Independent Insurance Broker, we are here to represent you. Should you have any questions or should you want to make any changes to your policy coverage, please don’t hesitate to contact our office. Increased Insurance premiums are beyond your control. Let us help in any way we can to ensure you receive the best insurance coverage at the best value.