Revealed – who’s disproportionately affected by rising home contents insurance charges? – insurance business
"In most states, an insurance rating, determined in part by creditworthiness, represents the likelihood of a claim being made and affects the premium a homeowner pays for coverage," said Ben Madick, Co-Founder and CEO of Matic Insurance. “The housing market, material costs and labor costs increased even before COVID-19.
“We now see these increases reflected in the estimated replacement costs of the house (coverage A), which ultimately lead, among other things, to rising insurance premiums. While homeowners with lower FICO scores saw a disproportionate increase, they get better coverage and the gap between Premium and Coverage A is closing. "
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The study also found that homeowners over 63 are most susceptible to overpayments for home insurance. While premiums are highest for homeowners between the ages of 43 and 55, the premiums for seniors do not decrease proportionally, Matic noted. The data suggests seniors overpay because they don't regularly review their policies and annual premium increases add up over time. Matic found that seniors could save an average of $ 751 a year by simply monitoring, reviewing, and adjusting their insurance policies.
"Many factors contribute to huge savings," said Madick. “Home improvement and car bundling could play a role, but the most common occurrence comes from a customer who has lived in the same house for over 20 years. Even without a claim, a homeowner will likely experience a premium increase of 3 to 4% each year. Over time, this increase is not insignificant. "
Industry studies have found that 40% of homeowners haven't reviewed their policy in the past two years.