Insurance Forecast for 2013

2012 was another very difficult year for insurance companies. Several storms, including hurricane Sandy, continue to put pressure on loss reserves and repair costs continue to increase. Another factor that will impact almost all insurance companies is reinsurance. Reinsurance is insurance for insurance companies and rates for reinsurance will almost certainly increase in 2013 and beyond.

Rates for home insurance in Virginia will continue to increase but there is something you can do to help. Discounts for package policies are at an all time high so make sure you review how much you can save with a package policy.

Contact The Andrew Agency to learn more or to obatin a free insurance quote!

Sandy's Affect on Insurance Rates

Hurricane Sandy will have an tremendous impact on the U.S. insurance market place, especially for Homeowners insurance. The market conditions were not great before and now with damage estimates between 5 - 10 billion Sandy will certainly have a negative affect on the insurance market.

Some companies will fair better than others but small to mid-size companies who had a large presence in the Northeast will be hit very hard. Erie insurance is one company who has a large presence in the Northeast but over all is a small company. Time will tell the direct impact Sandy has on the insurance company's bottom line.

Learn more

Check Your Deductible

Several insurance companies are raising deductibles on Homeowners policies. When you receive your renewal information review it carefully and make sure you are aware of your deductible.

Some companies are increasing your overall deductible and some are adding a separate Wind/Hail, Named Storm or Hurricane Deductible. In the case of a Wind/Hail deductible most companies are applying a percentage deductible which can be substainal.

For example, if your home is insured for $500,000 and you have a 3% Wind/Hail deductible you have to pay $15,000 before your policy will pay anything.

Click here to learn more.

Am I in a Flood Zone?

I get this question all the time and without evening speaking to you the answer is "YES".

Every home is located in a Flood zone it's just some zones are at a higher risk than others. Flood damage is the number 1 catastrophe in the nation yet very few homeowners purchase Flood insurance. Why?
I don't know the answer to why but I can tell you, if you think the government or Red Cross is going to come to your rescue when a Flood occurs, think again.

Flood insurance is very inexpensive especially if your home is located in a preferred Flood zone. The problem with Flood insurance is you can only purchase up to $250,000 for dwelling coverage and $100,000 for contents coverage but something is better than nothing. I would certainly like to receive a check for $350,000 verses $0 for my neighbor who doesn't have Flood insurance.

If you live in Virginia, Maryland or South Carolina and you would like to know how much Flood insurance would cost for your home, simply visit Flood Insurance Quote.

Should I file a claim on my homeowners insurance? It depends on the circumstances. Homeowners insurance is designed for a "sudden and accidential loss" but it is not a maintenance policy. Filing too many claims will cause your rate to increase or in some situations your policy will be cancelled.

Use common sense. If your $600 lawn mower is stolen and you have a $500 deductible, you should probably not file a claim. Even though you will receive a check for $100 your premium may increase by this amount or even more. Filing small claims will cost you more in the long run. Homeowners insurance is very important but it's designed for the big event.

Why are Insurance Rates Increasing?

2012 was one of the worst years ever for insurance companies. Hurricanes, Tornados, and large hail storms destroyed thousands of homes throughout the country and even though most of the damage did not occur in Richmond, homeowners should expect rate increases and stricter underwriting. Reinsurance premiums, reduced new business writing and low investment returns are all pressuring insurance companies to increase rates. Homeowners should expect rate increases of between 5 - 10% for the several years.