Homeowners and Drivers Feel the Pinch as Premiums Skyrocket Amidst Rising Risks and Economic Pressures

Insurance costs for both cars and homes are increasing rapidly across the United States. People like Ezra Croft and Paul Morro are experiencing significant hikes in their premiums, despite not having made any claims or living in high-risk areas. Insurance companies attribute these increases to the need to compensate for recent years of substantial losses, with claims and expenses exceeding collected premiums. Factors contributing to these losses include inflation, rising costs of labor and materials for repairs, and a surge in natural disasters affecting various parts of the country.

Insurers are facing pressure to adjust premiums to reflect these heightened risks, leading to double-digit percentage increases in both auto and homeowners’ insurance rates. While regulators have some authority to limit these hikes, insurance companies often exert significant influence to maintain profitability. Customers may mitigate these increases by shopping around for better rates, but overall, insurance remains a necessary expense for homeowners and drivers. Some individuals are even considering dropping coverage due to affordability concerns, although this poses risks for both individuals and communities in terms of economic stability and resilience.

Why your auto and home insurance premiums are surging : NPR