There is a lot happening in the insurance world today and we wanted to shed some light on what we’re seeing and what it means for you. Insurance prices are going up and it’s happening fast. It won’t matter what company you’re with, this is an industry wide issue.
Here are some facts:
- Home & auto insurance companies are for profit entities. If they lose too muchmoney, they go out of business.
- In 2022, the industry as a whole lost $26.9 Billion dollars
- That’s more than six times the $3.8 Billion it lost in 2021
- State Farm alone lost $6.7 Billion (up from $1.3 Billion in 2021)
- Geico lost $1.9 Billion
In 2022, every home and auto insurance company had HUGE losses.
So far, 2023 is shaping up to be just as bad.
The insurance industry has never seen anything close to what’s happening right now.
It doesn’t take a finance professor to predict what happens next.
Companies are scrambling to balance their financials and get back in the black. Theyare ALL increasing rates. Many of them are doing so dramatically.
Companies simply can’t operate profitably in this inflated market. It’s getting downrightnasty and ugly out there.
So, WHY has the cost of claims risen so much in the past 2 years?
➡️ Climate change has increased the number of storms and the intensity of them.
➡️ Every one of the past 3 years has broken records for storm quantity and severity.
➡️ Hail chasing roofers and other scam artists are out in full force. Offering free roofs, providing terrible outcomes, and reaping huge profits.
➡️ The cost to rebuild your home is up dramatically due to the rising cost of materials and labor.
➡️ Supply chain for materials continues to be an issue. We can all agree that everything has gone up in price.
➡️ The cost to repair your car is up dramatically due to the rising cost of auto parts and labor to fix your car. In addition, parts in vehicles now include some technology feature. Replacing a side mirror used to be $200 – now it’s more than triple that.
➡️ The cost of medical care continues to skyrocket. Bodily injury on auto accidents is off the charts.
➡️ Litigation is expensive and settlements are rising at an unprecedented rate.
➡️ Ambulance chasing lawyers are building fortunes off frivolous lawsuits.
➡️ Both the frequency and severity of auto accidents are WAY up post COVID along with the rising frequency of auto fatalities.
With cash flying out the door, companies have to raise premiums. If you have an auto orhome insurance policy, your rates have gone up and will continue to go up even more.This isn’t personal, it’s not based on whether or not you made a claim, it’s simply the costof doing business.
Companies simply can’t survive paying these higher claims without charging morethemselves.
“Ok, fine”, you say, “Prices are going up. So WHAT IS SHINE DOING ABOUT IT?!”
Great question!
1. We breakdown every renewal for you in a clear easy to understand way.
2. We shop any renewal that has an increase more than 9% with all of our bestcompanies.
3. We’re confident that our companies still have better prices than anyone else outthere.
4. When we send the renewal, we share whether there’s a better option than yourcurrent company.
5. We help you switch if that’s what you choose to do.
This year we’ve moved more clients from one company to another than any other yearin our history. Our team is working overtime to quote your renewals and get you thebest options.
When you receive your renewal (or the offer to switch you to a different company) thereare some things you can do to get the price down:
✅ Consider Higher Deductibles. This will help save some money on your policy.
✅ Discount Reviews – make sure you’re getting everything you’re entitled to. Everycompany has different discount opportunities. Make sure you go over those withyour agent.
✅ Bundle your Auto and Home for more discounts and more stable pricing.Bundled/Packaged policies most always include better coverage and benefitsand the cost savings is usually 20% on each policy.
✅ Consider tenure – jumping companies too often will hurt you in the long run.
✅ Follow the laws so you don’t get any tickets. Those tickets really add rate to yourpolicy and stay on your record 3-5 years, depending on the carrier.
✅ Absorb small claims when you’re able. Filing a claim for under $1000 is usuallyworse for you in the end.
✅ Don’t get swindled by folks offering cheap insurance. You don’t want to sacrificeactually having coverage for a claim just to save $50.
I hope this helps you understand the current state of the insurance world. We don’tmake the rules, we don’t have control over the rates and we don’t make the decision ifyour policy is cancelled by the carriers. We are here to help educate, make sure youhave the best insurance for your situation at the best rate available, manage youraccount with the company, and claims counsel when needed.
Our mission from the beginning has been to change the way you feel about insurance.Right now may be the hardest time in history to do that but we are going to continue totry.
Please reach out to any of our team members for help understanding your policies andhow this situation will affect you. We’re doing everything in our power to help.
Shine on,
Jeremy GoodrichChief Protection Officer
