Why Are My Home and Auto Rates Increasing?
Illinois drivers and homeowners may notice rising insurance rates—even without a history of claims or moving violations. Traditionally, one of the most significant factors affecting your auto and home insurance rates is your driving and claims history. However, numerous factors outside our control can trigger premium increases across the country.
Hard Market Causes Premium Increases
The insurance market hardens when insurers must pay out significantly more money to cover claims than they have in the past. When an insurer feels less financially stable, they toughen underwriting standards, raise premiums and restrict coverage to help reduce their future risk.
Many factors can contribute to a hard market. Fluctuating market stability and economic conditions can trigger premium increases. Insurers have experienced numerous challenges in recent years, including the following:
- More auto-related losses—As more people return to work post-pandemic, the number of auto accidents and claims rises. Supply chain challenges result in higher parts costs. A labor shortage causes auto repair shops to raise wages, triggering price increases for repairs covered by insurance.
- Higher auto repair costs—Modern vehicles are equipped with expensive technology, such as cameras, bumper sensors and automatic braking systems, that are expensive to replace after an accident.
- Insurance fraud—Staged auto accidents, falsified documents and manufactured legal claims negatively affect the insurance industry’s financial stability.
- Severe weather—Catastrophic damage due to extreme weather conditions such as wildfires, wind storms and flooding can trigger widespread home and auto insurance claims, causing financial hardship for insurers.
How Can I Get Lower Premiums for Home and Auto Insurance?
Your agent can help determine whether you are eligible for any unclaimed discounts. For example, if you bundle your home and auto policies, your insurer may reduce your premiums by up to 20 or 25%. Your agent may recommend changing your coverages to better align with your needs, which can help reduce your insurance costs.
Contact V Financial in Rolling Meadows, Illinois, to learn more about how to get the best possible combination of coverage and value on your home and auto policies.
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.