Inflation: A Pickle for Property Insurance


All of us are feeling the grip of inflation. Building materials costs have spiked over the last 2 years. Supply chain disruptions and labor shortages are causing major delays in construction projects. As a result, it now costs more to rebuild your home than it did before. 

 
When was the last time that you checked your policy limits? Are they high enough to cover a 26% increase in building costs? If not, then you have to pay the difference out of pocket.
 
Hanover Insurance Company shared some of the numbers behind inflation in a recent post.  They recommend that policyholders consider
 
  • Increasing coverage to avoid potential gaps in the current market
  • Include the cost of any recent renovations in your policy limits
  • Consider higher deductibles to help offset the cost of policy limit increases
 
The insurance industry is working to help policyholders stay ahead of the curve. Many carriers are running Replacement Cost Estimates on covered properties and adjusting property limits as needed. 
 
They are also increasing the Inflation Guard percentage on Property policies as well. Inflation Guard endorsements increase Property coverage limits by a specified percentage (usually 4%) at each renewal. Lately, carriers have increased Inflation Guard percentages to 8% and even 12%. 
 
Now is a great time to review the Dwelling limit (Coverage A) on your Homeowner's policy.  Review your policy renewal to see what changes are being offered and whether they are adequate to properly protect you. 
 
Let us know how we can help!

Comments

Post a Comment

Popular posts from this blog

Don’t be the next cyber security statistic!

Image
  By prioritizing cybersecurity, organizations can mitigate the risk of data breaches, financial losses and reputational damage. Whether you're an individual or an organization, understanding the importance of cybersecurity is fundamental to navigating the threat landscape safely and securely. The increased connectivity of the digital world means greater security vulnerabilities and cyber risk. Remote and hybrid work arrangements, increasingly sophisticated attackers, creative social engineering, and a rise in the number of passwords people use have all contributed to more cyber attacks. The results can be costly. Organizations that are ill-prepared or lacking in security and risk protocols will find themselves paying a hefty price both in reputation and financial loss.   While it’s nearly impossible to prevent all cyber attacks, your organization can reduce cyber risk by ensuring it’s prepared for the most common types of attacks.  The most common types of risk...
Read more
Image
  The month of April is Distracted Driving Awareness Month. Because it involves cognitive, manual, and visual distraction, fiddling with your phone while driving is extremely dangerous.  We ask everyone to make a special effort to set the phone aside while driving.  We here at Brock-Norton encourage our clients, employees and any/all drivers to put down their phones and buckle up.   The CDC has said that there are three types of distracted driving. They are as follows: 1.      Visual distractions that cause you to take your eyes off the road. a.      Examples:                                                      i.      This can be using a G...
Read more

Attention Vehicle Owners: Protect Your Investment from Theft

Image
  In recent months, we have had several policy holders impacted by vehicle theft. Check out this brief blog for tips on how to reduce the likelihood of your vehicle being stolen! Vehicle theft is increasing and continues to plague the already strained Auto Insurance Market. With premiums on the rise, inventory low and the time and cost to repair skyrocketing, cars are more expensive to obtain and maintain than ever. Across the country there is a 34% spike of stolen vehicles compared to last year. In DC alone there was a spike of 113% of car thefts compared to 2022. That equals about 18 cars, trucks, vans and motorcycles stolen every day. We should be aware that a majority of car thefts are from people that are stealing cars to strip and sell parts. It is also reported that some cars that are stolen are being sent overseas for sales.   Here are some tips that you can enact at home and in your business to reduce the chances of you waking up to an empty driveway. Always lock the ...
Read more