Insurance Premiums on the Rise: Insights from Pam Wargin of American Family Insurance
Pam Wargin of American Family Insurance
During the recent TRBA meeting on October 5th, Pam Wargin of American Family Insurance offered valuable insights on a concern that impacts all of us—rising insurance premiums.
In an engaging presentation, Pam dissected the causes of the increase and offered actionable advice for consumers to better navigate the changing landscape.
Why Are Insurance Costs Rising?
When it comes to auto insurance, you can expect higher costs primarily due to an uptick in repair and replacement expenses. Thanks to advancements in technology, vehicles are becoming more expensive to fix. On top of that, medical expenses and litigation costs are also escalating, putting additional pressure on premiums. The pandemic hasn't helped either; it has strained supply chains and inflated the cost of claims.
In the homeowner's insurance sector, things are equally grim. Material costs for everything from roofing to drywall are up. Add to this the growing costs of skilled labor, and you're looking at every claim costing 20-30% more than it used to. This isn't even mentioning the surge in environmental disasters; losses exceeding $1 billion have tripled since 2001.
What Can You Do?
For Auto Insurance
Pam suggests leveraging apps that monitor your driving habits to potentially lower your rates. The idea is to move out of the 'average' pool and prove you're a lower-risk driver, thereby reducing your premium.
For Home Insurance
Technological aids like moisture pads can alert you early about issues like water in the basement. Before filing a claim, it's always wise to consult a contractor for an evaluation. A claim on your record, even for minor damage, can have long-lasting repercussions.
General Tips
Higher Deductibles: Pam mentioned that opting for higher deductibles can translate into annual savings.
Shop Around: It's crucial to compare rates from different companies. But beware of companies that are on shaky financial ground—they may offer attractive rates as a last-ditch effort to cover unsustainable losses.
Ask Questions: Before settling on a policy, don't hesitate to ask what will happen if you have to file a claim. It's better to know now than to be caught off guard later.
Pam’s talk was an eye-opener, emphasizing the need for consumers to stay proactive in managing their insurance costs. Given the inevitability of rising premiums, Pam’s pointers offer a way to take some control over this unavoidable expense.
