Of all the industries affected by COVID-19, you might wonder how the insurance industry could be affected. How can a health crisis affect insurance types not related to health? Unfortunately, a domino effect has begun with people changing their old habits to new ones, and insurance premiums reflect those changes. In addition to the health crisis, other unfortunate and unforeseeable events, such as the infamous Texas Snow/Sleet storm, have negatively affected insurance premiums. We’ve got the lowdown on some industry changes you might see bubbling up.
On the Road Again: Auto Insurance Changes
A couple of years ago, at the beginning of the COVID-19 pandemic, most people halted their day-to-day transportation and stayed home to help avoid the spread of germs. As a result, highways were noticeably less-crowded, and car sales were down. Now that businesses are picking back up again, more drivers are getting back behind the wheel and heading back to their daily destinations. So naturally, more insurance policies are needed to protect those on the road. The good news for drivers is that many policies are getting more competitive; however, the bad news for drivers is that auto repair costs are getting more expensive and harder to procure with the supply chain shortage. Labor shortages, more severe claims, and gas prices are other contributing factors to incoming raised premiums.
Home Is Where the Heart Is: Property Insurance Changes
You may have recently heard in the local news that San Antonio-area homebuyers are canceling new construction home contracts at record rates due to rising construction costs. Lumber and asphalt materials are still near the all-time highs we saw in the middle of the pandemic. As a result, the cost of insuring these properties has also increased with the rate of materials staying inflated. As if the pandemic wasn’t insulting to injury enough, 2021 was also a bad year for weather. According to Climate.gov, 20 weather and climate disasters totaled $145 billion in cost. Remember “The Texas Snow Storm”? Droughts, snow storms, tropical hurricanes, heat waves, and more devastated the United States, causing property insurance to rise.
Although looking back on 2021 statistics can seem sort of “doom and gloom,” we at SOGO Insurance want you to know that the current trends don’t have to break your coverage plans. Call one of our helpful agents to discuss how your premiums might be affected by these trends and to see if you’re a candidate to shop for a new policy that better suits your situation. Don’t let raised premiums scare you into canceling policies. You don’t have to give up the protection of your most valuable assets to thrive. We’re here to help you and take pride in treating our clients like family.
Check our website for other insurance policies you may benefit from, including wedding, valuable possessions, travel, and more.
In case you missed it: Check out “The Cons of Working From Home” to learn about the risks of having a home office.
