Each year we take a look at the current trends of the insurance industry and evaluate how those trends may impact our customers’ insurance rates. When it comes to home and auto insurance, here is some of what we have seen over the last year.
Auto Insurance Trends
In 2021, we saw an increase in accidents along with an increase in repair and replacement costs. This means that the overall cost of a loss has increased. Some of the factors that are causing this include:
- Used car prices have increased by up to 26.4% and new car prices have increased by up to 9.8%1.
- The labor shortage has led to us having 1/3 as many trained auto technicians to repair our vehicles. 2.
- The supply chain issues have led to a shortage of chips and new cars available3.
- Parts needed to repairs have increased in cost by up to 6%4.
What this means is that in the event of an accident, it will likely cost more than it did last year to repair or replace your vehicle. Due to these increases, we will likely see premiums increase.
Home Insurance Trends
In 2021, we saw an increase in home related claims along with an increase in repair and replacement costs. Some of the factors that are causing these increases include:
- The cost of material goods for new residential construction have increased by up to 18.6%5.
- Lumber and wood prices increase by up to 6.2%6.
- Asphalt roofing material prices increased by up to 16.3%7.
- The labor shortage has impacted the construction business with over 350,000 job openings in the industry as of August 20218.
What this means is that in the event of a loss, it will likely be more costly to repair or replace your home. In addition, due to the decrease in available contractors, it could cost more in labor or take longer to repair your home than before. Based on these factors, we expect to see a premium increase.
Don’t Panic!
Gannon Associates Insurance is here to help. If your insurance rates are impacted and you are seeing increases, there are some options we can look into. We can start by doing a coverage review, making sure that your coverage is right for your needs and that you have all available discounts applied. We can also shop around for you. We have access to a variety of insurance carriers and can shop around to see if there is another carrier that might meet your needs at a lower cost point.
No one enjoys hearing that their insurance rates are going to increase. Thankfully, with Gannon Associates Insurance, you aren’t alone. Our team is here to help find the right insurance solutions for your unique needs. Give us a call at 844-GANNONS and have a conversation with your agent to find a solution together.
