Why Are Homeowners Insurance Premiums Rising?

If you own your own home and have recently renewed your homeowners insurance policy, you may have noticed that your insurance rate increased from previous years. If you are a homeowner in San Diego, California and were affected by more expensive insurance premiums this year, you are not alone in wondering why. The insurance specialists at Windfall Insurance are here to answer any policy questions that you may have. Continue reading to learn more about why homeowners insurance premiums have been rising in recent months.

Common Reasons For Increased Homeowners Insurance Rates

There are several reasons that your insurance policy may have increased recently; some that are within your control, and some factors that may be outside of your control. Some factors that may contribute to increased insurance rates that are within your control, for example, are if you need to replace something in your home like the roof or if you have filed an insurance claim recently. One major factor that is affecting insurance rates that are outside of a policyholder’s control is inflation and the continued cost increase in construction and labor materials, as well as lingering supply and demand issues stemming from the pandemic. Insurance rates are mainly based on the amount of dwelling coverage your policy has, which helps rebuild your home if it is damaged. Since the materials used to rebuild a home are more expensive, insurance rates have been raised to keep up with these increased costs.

Another major reason homeowner insurance rates have been rising is because of the occurrence of more extreme natural disasters, including wildfires here in California, causing a significant increase in financial loss and claim payouts. This has caused insurance companies to pay substantially more for these losses. Additionally, if you have an older home that is in need of upgrades or renovation, your insurance may increase in order to account for the high risk of claims for an incident such as a plumbing or electrical problem. Your insurance score may also dictate your insurance rate. If you are believed to be someone who is likely to file a claim, your homeowners insurance rate may be higher.

What Are Some Ways To Possibly Your Homeowners Insurance Premiums?

Even with recent homeowners insurance rates, there are some measures you can take in order to help lower the cost of your rates. It is advisable to speak with your insurance agent to see if you qualify for any discounts, for example: multi-policy or bundled discounts, loyalty, claim-free, first-time homebuyer, senior citizen discounts, etc. Increasing your deductible amount and shopping around for other insurance deals annually can also help a policyholder lower their homeowners insurance costs.

If you are interested in learning more about your homeowners insurance costs in San Diego, California, contact Windfall Insurance Services Inc. for a consultation.