According to S&P Global Market Intelligence statistics, homeowners’ insurance premiums are rising faster than inflation, and Triple-chief I’s insurance officer predicts that trend will continue.
According to S&P, premium rates are rising 11.4 percent on average across the country from 2017 to 2020. Rising material costs and supply-chain interruptions have recently pushed up home-replacement costs, and insurers have responded by raising premiums. In 2021, the average annual premium across the country will be $1,398.

According to Triple-Dale I’s Portfolio, “with what I know about homeowners’ risk, I expected those percentages to be higher.” “Honestly, I believe they should go even higher.”

The majority of mortgage lenders demand that borrowers get homeowners’ insurance. According to Bankrate.com, the average homeowner spends 1.91 percent of their income on homeowner’s insurance. Costs are often driven up by location, especially if the home is in a region prone to natural calamities. Because it costs more to rebuild a house in some places, the rates are higher.

Tornadoes, hurricanes, severe storms, wildfires, and other natural disasters caused $82 billion in insured damage in 2021, according to Porfilio, bringing the total from 2017 to 2021 to more than $400 billion. The graph below shows that average insured natural disaster losses have increased by more than 700 percent since the 1980s.
“All things weather-related are still under strain due to climate risk,” Portfolio remarked. “We’re seeing more severe hurricanes, more terrible wildfires, and the research isn’t clear on whether tornadoes are occurring more often or not.” “( But one thing is certain: the severity is increasing. “

When a natural disaster strikes a large area, demand for goods and labor increases, putting downward pressure on costs.

Add the effects of supply-chain disruptions caused by pandemics to the effects of extreme weather and changes in the population that have been driving up insurers’ costs and, in turn, the premiums of policyholders.

The Washington Post wrote that “lumber producers anticipated a repetition of the Great Recession when the pandemic struck.” “They reduced manufacturing and depleted inventories.” However, demand skyrocketed, taking them off guard. In March, the price of lumber jumped 400 percent year over year to $1,500 per thousand feet of board. “

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