Insurance
Questions/Tips Insurance

Punxsutawney Phil's forecast bad omen for homeowners insurance rates

(2/2/2012) ERATE Exclusive - You didn't need famous groundhog Punxsutawney Phil to tell you to prepare for winter's worse.

But you do need to consider what the weather holds in store for your homeowners insurance rate.

When Phil emerged from his lair on Groundhog Day, Feb. 2, saw his shadow and doomed the nation to six more weeks of winter - or so the legend goes - many insurance companies had already filed for homeowners insurance rate hikes due to the weather that's already wreaked havoc.

Record weather-related catastrophes in 2011 and soft economic conditions have spawned the latest round of homeowners insurance rate hikes, according to A.M. Best Co., an insurance rating and information source.

The Federal Emergency Management Agency (FEMA) reports the nation suffered 99 major disaster declarations in 2011, more than any other year since FEMA began recording the statistic back in 1953.

The most notable declarations were due to Hurricane Irene slamming the Eastern Seaboard, along with Tropical Storms Irene and Lee. Also, devastating swarms of tornados twisted through the Southeast and Midwest last year, taking lives and destroying communities.

A.M. Best said, based on existing rate increase request filings, some insurance companies will raise homeowner insurance premiums by 18 percent or more in 11 states, including Alabama, Arizona, Colorado, Georgia, Kansas, Kentucky, Maine, South Carolina, South Dakota, Tennessee and Virginia.

Travelers Personal Security Insurance Co. raised one of its homeowners products 25.5 percent effective Dec. 23, affecting 50,000 policyholders. Three EMC Insurance Cos. subsidiaries in Alabama raised rates on specific homeowners lines about 20 percent effective Dec. 1, affecting 3,800 policyholders, Best reported.

In addition to disaster, falling profits also contribute to higher rates.

"When a company's recent underwriting results are profitable, it's very difficult for them to get a rate increase," said Raymond Thomson, an A.M. Best Co. senior financial analyst.

Saving money on homeowners insurance

But there are steps you can take to weather the storm of higher premiums.

Reduce a disaster's impact. Retro-fit your home to better withstand the seismic forces of an earthquake, the gale forces of a hurricane or the burn threat of a wildfire . The Insurance Institute for Business & Home Safety offers more tips for reducing losses.

Shop smart. Don't shop for the best rate and then determine your needs. Know what coverage you need first, then go comparison shopping. Consumer Reports says annual premiums can vary widely. Check your state insurance regulator for rate comparisons as well as websites, including Insure.com, InsWeb and NetQuote.

Choose an insurance company rated "A" or "B" by Weiss Ratings available online at The Street.com. The more solvent a company, the less likely it will raise rates, according to Thompson.

Trim costs. Take on higher deductibles. Buy all your insurance needs (home, auto, health, life) from one company and get discounts. Keep your credit rating as high as possible. If your can't afford catastrophic coverage, check with your state's insurance of last resort program.

File smart. Don't make claims for small losses if you have high deductibles or can afford to pay for the damage out of pocket.

Express Mortgage

 

Fannie Mae & Jumbo Mortgage Rates

Just One Click! = Current Rate Chart

Pennsylvania Mortgage Rates Current Mortgage Rates - Hawaii Current Mortgage Rates - Alaska West Virginia Mortgage Rates Virginia Mortgage Rates District of Columbia Mortgage Rates Maryland Mortgage Rates Delaware Mortgage Rates New Jersey Mortgage Rates Connecticut Mortgage Rates Rhode Island Mortgage Rates Massachusetts Mortgage Rates New Hampshire Mortgage Rates Vermont Mortgage Rates New Hampshire Mortgage Rates Maine Current Mortgage Rates Vermont Mortgage Rates Current Mortgage Rates - New York Current Mortgage Rates - Michigan Current Interest Rates - Wisconsin Current Mortgage Rates - MINNESOTA Ohio Mortgage Rates Current Mortgage Rates - Kentucky Current Mortgage Rates - Indiana Illinois - Current Mortgage Rates Current Mortgage Rates - Iowa Missouri Mortgage Rates Current Mortgage Rates - North Carolina South Carolina Mortgage Rates Current Mortgage Rates - Florida Current Mortgage Rates - Georgia Current Mortgage Rates - Tennessee Current Mortgage Rates - Alabama Current Mortgage Rates - Mississippi Current Mortgage Rates - Louisiana Current Mortgage Rates - Arkansas Current Mortgage Rates - Oklahoma Current Mortgage Rates - TEXAS Current Mortgage Rates - New Mexico Current Mortgage Rates - Arizona Current Mortgage Rates - Kansas Current Mortgage Rates - Nebraska Current Mortgage Rates - Colorado Current Mortgage Rates - Wyoming South Dakota Mortgage Rates Current Mortgage Rates - North Dakota Current Rates - Montana Idaho Current Rates Washington Mortgage Rates Current Mortgage Rates - Oregon Current Mortgage Rates - Utah Current Mortgage Rates - Nevada Current Mortgage Rates - California

Start by selecting your state

Other Related Articles:

Don't add on 'add-on' insurance

Homeowners insurance goes to school

Costly trends impacting homeowners insurance

Insurance - Homeowners Insurance Advice

Always time for a home inspection

 


Get the Updated and Improved Mortgage Rates App from ERATE.com

iPad for Mortgage Rates

Auto Insurance

General Insurance Articles

Homeowners Insurance

Medical Insurance

Life Insurance