Sentinel Risk Insurance Group has had several customers inquire regarding insurance rate increases. The Insurance industry is a variable industry. Depending on specific events, most outside of our control insurance rates rise and fall. To help understand why home and auto insurance rates increase, Team Sentinel put together of the top 5 reasons impacting the insurance industry today:
- Rising home prices. Increased home prices and high-end features, like pools and hot tubs increase liability claims & replacement costs.
- Extreme weather. Forest fires in Western Canada, Quebec floods, and storms across the country has become more frequent, and causes extensive damage to homes and property, resulting in an increased volume of claims.
- “Green” doesn’t always mean budget-friendly. New Eco-friendly features like solar panels, energy efficient windows and doors, and high-efficiency appliances are a great choice for our environment but it’s important to realize that if these items become damaged, they normally result in more expensive repairs or replacement.
- Finished basements need more coverage. To comply with local municipality and federal building codes, finished basements normally require higher priced building materials. Finished basements cost more to repair if there’s a sewer backup or other damage.
- City and Municipal infrastructure is aging. Outdated municipal infrastructure and a increased demand for water makes sewer backups more frequent. This results in more damage-related home claims.
- Neighbourhood trends might put you at greater risk. As neighbourhoods grow, demographics and risks change. In Ontario, most urban areas have new commercial development, or a new subdivisions. This often alters municipal infrastructure. Insurers will consider these factors when assessing risk on your home or property.
- General Inflation. Emergency services, skilled trades, and personal belongings are becoming more expensive. Generally with any goods or services, inflation means higher prices for things like emergency services and labour costs for repairs. That means paying for claims is more expensive.
Do you have questions regarding your home or auto insurance rates? Contact a Sentinel Risk Insurance Group broker today to help answer any insurance questions you might have. Call us Toll Free 1-888-231-2011 or visit our contact page.
To read more on insurance rate increases, check out Economical’s Blog Posts.