Change is the one thing we can always count on. Whether it’s the weather, economy or the political party in charge, we have to live with change and navigate the changes the best we can.
Certainly with the devastating wind and hail storms Oklahoma and the Midwest have suffered this year, we can be looking for changes in home insurance premiums, coverage, and deductibles in the coming months.
Most of the agencies that write Oklahoma property insurance, whether home or commercial property, have paid out on average $1.15 for every $1.00 in premium they have collected over the past 5 years. It doesn’t take a rocket scientist to figure out that companies are not going to continue to lose fifteen cents on every dollar they collect. The estimated damage from the storms that hit the Metro Oklahoma City area in the early summer is in excess of $1,000,000,000. Yes, that is a billion dollars, with a “B”.
So what are some changes that we can expect? The changes will vary company to company, but here are some of the changes currently under consideration by various companies.
The first consideration will be premium increases. We have already seen this happening with a number of companies. We can also expect higher deductibles for wind and hail. A 1% or 2% wind or hail deductible is becoming very common.
What does that mean? For example: if you have a 1% deductible on a $150,000 home, your wind/hail deductible would be $1,500.
I anticipate even more difficulty in getting “replacement cost coverage” on roofs. Certainly if the coverage is offered it will be more expensive. A number of companies are setting stricter and stricter guidelines for roofs to qualify for the coverage.
What can you do to minimize the impact of increase on your budget? Consider increasing your deductible. And make sure you are getting all the discounts you qualify for.