Home insurance is an absolute necessity. In addition to being a requirement for most mortgage companies, a home insurance policy provides peace of mind and coverage for your family, the dwelling, and its contents. While shopping for the best insurance rate possible and choosing the coverages that fit your specific life is important, many of us have noticed an increase more than usual this year.
First, it’s important to know that home insurance premiums are based on factors such as your home’s location, how old the dwelling is, and your insurance score. This comes down to a score on the probability of a claim. These factors can vary from customer to customer and change based on conditions. However, there are other factors that are out of everyone’s control such as industry increases that will hit everyone – no matter where they have a home.
Things like a large number of claims filed due to natural disasters are one example.
Ever since the COVID-19 pandemic began over a year and a half ago, material and builder shortages soared. This is a key contributing factor to insurance increases homeowners are now seeing.
According to reports, rates up an average of 4% in 2021.
In addition, there is a shortage of laborers and everything is trickling down the pipeline. The bottom line is that it is now much more expensive to build, repair, replace and insure homes.
If construction costs are up that means the cost to replace your covered dwelling will go up too and these extra costs will be added right into your premium costs.
While everyone across the map is seeing these types of increases, it’s always a good idea to shop around and ensure your coverages are the best possible.
Contact Petruzelo Insurance and speak to an agent you can trust.