Everywhere you look, things are getting more expensive. Across industries, there are ongoing supply issues that affect the prices of everyday items.
As with most financial institutions, higher-than-expected inflation has affected property/casualty insurers. Insurers charge prices today that will pay for future claims. If inflation proves to be greater than the inflation rate anticipated in the prices, then insurers may not have sufficient funds to pay claims. As a result, be sure to contact your agent to talk about how inflation may affect your premium pricing.
Another reason to talk with your agent is that you might need more coverage. It may now be more expensive to repair or rebuild your home than when you bought the policy. Due to inflation, the cost of labor and the cost of building materials have gone up considerably because the housing market is so hot right now. If a disaster devastates a particular region, that can spark even higher costs locally because contractors and materials are in such demand.
To make sure your dwelling coverage will be sufficient to rebuild your home, ask your insurance company about extended replacement coverage. With this optional add-on, your insurer will pay a set amount above your dwelling limit if rebuilding ends up costing more than expected.
We are happy to assist with any questions you have about your insurance policies and whether you may need more coverage. Contact our team today.