Why Your Insurance Rates Are Going Up (And Why You May Be Non-Renewed)
If you’ve noticed your insurance rates creeping up or received a non-renewal notice, you’re not alone. This is happening to many people across the country, and while it’s frustrating, there are some understandable reasons behind it. Let's break down why this is happening and what it means for you.
1. Ambulance Chasers & Lawsuits
We’ve all seen the ads: “Hurt in an accident? Call now!” These personal injury lawyers, often referred to as “ambulance chasers,” encourage people to sue for big payouts after accidents. While some claims are legitimate, others may be exaggerated. Unfortunately, these lawsuits cost insurance companies a lot of money.
When insurance carriers pay out large sums due to lawsuits, they need to make up for those losses. One of the easiest ways to do that is by increasing premiums for everyone or even choosing not to renew policies in high-risk areas.
2. Inflation is Driving Up Costs
Inflation affects everything—including insurance. When the price of materials, labor, and medical care increases, it costs more to repair cars, rebuild homes, and cover medical bills. For example, if fixing a car after an accident costs more today than it did five years ago, insurance companies have to adjust premiums to keep up.
This rise in costs doesn’t just affect you; it also hits insurance companies hard. So, to stay in business, they pass some of that cost onto policyholders.
3. More Losses = Higher Premiums
Insurance companies are businesses, and just like any business, they need to make a profit to survive. In recent years, there have been more losses—whether due to natural disasters, accidents, or lawsuits. These losses mean insurance companies are paying out more than they’re bringing in.
To recover, they have two options: raise rates or stop offering coverage in certain areas or for specific risks (also known as non-renewing policies). It’s not personal, but rather a business decision to maintain their financial stability.
What You Can Do
While you can’t control inflation or lawsuits, there are a few things you can do to try to keep your premiums in check:
Let WeadCo shops rates for you: As an independent agency, we work with multiple insurance carriers and do the shopping for you! We’ll find the best rate and coverage options tailored to your needs.
Minimize claims: Keeping your claims to a minimum can help you avoid premium increases. For example, consider paying out of pocket for smaller repairs instead of filing a claim. This can help maintain a clean claims history and keep your premiums lower.
Have an honest conversation with your agent: If you’re feeling financially strained by rising insurance costs, talk to your agent. We can discuss your coverage and explore options to adjust your policy and premium. Whether it’s increasing your deductible, adjusting coverage levels, or finding discounts, we’ll work with you to find a solution that fits your needs.
The Bottom Line
Insurance rates are going up for many reasons—lawsuits, inflation, and higher payouts all play a role. While it can be frustrating, understanding why it’s happening can help you make informed decisions and hopefully find ways to save.
If you have questions about your policy or need help navigating your options, utilize WeadCo Insurance. We're here to brand your assets.
