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Home and auto insurance rates are continuing to rise in 2023.

Dan Beech Agency

Home and auto insurance rates are continuing to rise in 2023
Thanks to an unusual convergence of market trends, ushered in by the pandemic and followed by other disruptive events, you may see a bigger change to the cost of your home and auto insurance than usual when it comes time to renew your policies this year.
Insurance rates are based on what an insurer thinks it will cost to make you whole in the event of a loss – roof damage during a windstorm or a vehicle totaled during a traffic accident. As you’ve likely noticed, almost everything costs more than it did a few years ago.

What’s driving higher home insurance costs

If you’ve shopped at Home Depot or Lowe’s lately, you’ve seen that the price tags on building materials have gotten pretty expensive. https://bit.ly/45ZUdQX Last year, the cost of building materials rose 4.7%, reflecting a particularly strong uptick in prices on things like asphalt shingles (16.2%), concrete blocks (18.5%), and drywall (20.4%).
To make matters worse, the home-building industry faces a shortfall of more than 300,000 skilled laborers, driving construction-related labor costs. Combined with the high cost of construction materials and historically low housing inventory, this has made home claims much more expensive for insurance companies.

What’s driving higher auto insurance costs
Ongoing supply chain issues drive a shortage of car parts and equipment, https://bit.ly/45YO9bk which were 22.3% more expensive at the end of 2022 than two years earlier. The overall cost of maintaining and repairing vehicles increased 18.4 % over the same timeframe – exacerbated by a growing shortage of car repair technicians.
The same issues depleted the supply of new and used cars during the COVID-19 pandemic, and inventories have not yet recovered. As a result, the average price of new cars has risen 20% since 2020, while used car prices have skyrocketed 37%.
Rising medical costs are another key factor. While the number of injuries and fatalities from car accidents has somewhat declined from its peak in 2021, the rising cost of medical care continues to drive higher claims costs. Between 2020 and 2022, the overall cost of medical care in the U.S. increased 6.8%
Focus on value as you explore ways to save
Keep in mind that savings come in many forms. The value of the coverage you choose today may save you more in the long run than the lowest possible premium.
Contact us to review your current coverage. We’ll help you explore opportunities for discounts that could offset higher rates when it comes time to renew.

Home and auto insurance rates are continuing to rise in 2023. Sources: National Association of Realtors, Federal Reserve Bank of St. Louis, Home Builders Institute, CoreLogic, Consumer Price Index, TechForce Foundation

For more information, visit: https://www.beechagency.com/insurance/

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