Current Factors Affecting Home Insurance Rates
Unless your home happens to be under a rock, you’ve probably already felt the sticker shock of the dramatic rise in home insurance rates. With inflation, supply chain issues, labor shortages, and geopolitical strife, the trickle-down impact on our daily cost of living is a complex beast. However, our insurance experts at Lifetime are here to try and help unravel the tangled web of factors driving up your home insurance rates, so you can help make the most informed coverage decisions for you, your loved ones, and your home.
Rising Home Insurance Rates – 40,000 – Foot – View
As we pointed out earlier, the factors driving up home insurance rates are complex and far-reaching across multiple isles. From the political/geopolitical sphere to the economic and weather/climate sphere, there are numerous reasons behind these recent price hikes. With that in mind, we will take a 40,000 – foot – view of current events and circumstances, and examine how each piece fits into the larger puzzle.
Pricey Material Goods
According to the U.S. Bureau of Labor Statistics in the Producer Price Index by Commodity, material goods for new residential construction prices have risen by 18.6% over the past year. To further contribute to the price increase, the cost of asphalt roofing materials has gone up 16.3% over the past year.
Lumber Price Hikes
If you’ve recently built a home or are in the construction industry, it’s no news to you that the price of lumber has gone through the roof. In fact, according to the U.S. Bureau of Labor Statistics in the Producer Price Index by Commodity, lumber is up in price by a whopping 6.2%.
Weather-Related Claims
These past two winters have been quite volatile in many regions throughout the U.S. According to the NOAA National Centers for Environmental Information (NCEI), there were 20 separate $1Billion+ weather – related loss events in 2021!
Labor Shortages
To further conflate the rising costs of home insurance claims and coverage, there are 358,000 job openings in the construction industry as of August 2021, according to the U.S. Bureau of Labor Statistics, making repairs significantly pricier.
Explore Your Options
With access to multiple carriers, we specialize in building custom insurance plans tailored to your coverage needs and price point.
A Closer Look at Home Insurance Rates: Why is Home Insurance So Expensive?
So, the overarching question is why is home insurance so expensive? Just as there is not a simple, singular reason to point to for the rising home insurance rates, there isn’t a definitive answer as to when rates will stabilize. We are looking at historical inflation that continues to rise, as well as geopolitical events that will continue to impact our supply chain. As long as shortages on material goods and labor continue to persist, it will be likely that we will continue to see some rising home insurance rates.
Build Your Coverage with Lifetime
While we cannot ultimately control most of the factors impacting rates, our insurance experts at Lifetime can help you stay ahead of rising rates by shopping your policies among our multiple carriers. If you’re looking for better coverage at better prices, we can help you shop and hopefully save some money! Give us a call today at (972) 771-2622 or visit our website!
See What Lifetime Can Do For You
If you’re ready to build a custom home insurance plan that suits your lifestyle without breaking the bank, give us a call today at (972) 771-2622 or click the button below to learn more about what Lifetime can do for you.