Factors driving an increase in Auto and Home insurance rates
In 2021 people started returning to pre-pandemic behaviors and driving more often. This resulted in the likelihood of more accidents happening.
20 separate $1 billion+ loss events happened from the weather in 2021. The rising weather related damages have gone up which then effects the increase in overall insurance rates.
Also, repairs and replacements to rebuild a home have increased in cost significantly.
Factors that are driving an increase in auto insurance premiums according to Travelers Insurance:
- Supply chain issues triggering shortage of chips and new cars
- Increase in severity of auto accidents; number of fatal car crashes up 18.4%
- Used car prices up 26.4% New car prices up 9.8%
- Average car insurance claim costs up 20% and parts costs are up 6%
- There are labor shortages and wage increases are up 9%
Factors that are driving home insurance rates according to Travelers insurance:
- Material goods for new residential construction prices are up 18.6% over the past year
- Asphalt roofing materials prices are up 16.3% over the last year
- 358,000 job openings in the construction industry as of August 2021
- Prices for lumber and wood products are up 6.2%
Merit Insurance Group is here to make insurance solutions easy. Call us at 708-845-5466 or visit our website www.meritinsurancegroup.com for any insurance needs.