Several factors leading to rising insurance costs, experts say
JACKSON, Tenn. — The cost of living has been rising for years and has affected just about everyone. Insurance has been no exception to the rising prices.
David Sampson, the President and CEO of the American Property Casualty Insurance Association, gives us more detailed information.
“Home construction labor has increased 36% over the last five years,” Sampson said. “Home construction materials have increased 42% over the last five years. And auto repair has increased 56% in labor and parts.”
Another reason for insurance prices going up, according to Sampson, is something called a “tort tax.” He says this is coming from legal system abuse.
“In Tennessee, the tort tax is calculated at over $3,000 for a family of four. That’s up 6.8% from 2016 to 2022,” said Sampson.
Whether you are building a new home, or have lived in the same one for a period of time, making sure it is made with storm resistant materials can help your insurance premiums.
“The National Institute of Building Sciences estimated that for every $1 invested in home construction resilience saves $13 in storm damage if a storm hits that house. So it really does make a difference,” Sampson said.
Since 2020, insurers have incurred over $500 billion in losses from natural catastrophes — the biggest five-year period of losses in history.
You can also always call your insurance agent to look at different ways of lowering your premiums.
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