6 on Your Side Consumer Confidence: Home insurance hikes
(ABC 6 News) — Homeowners nationwide are facing a crisis of skyrocketing insurance premiums or outright policy non-renewals, even in areas traditionally considered “low risk.”
Without warning, millions of people are finding out their insurance policies are about to cost significantly more or be canceled outright.
That’s what happened to Kenyetta Twine back in August.
“I got an email saying that my insurance was canceled,” Twine said. “I said ‘oh my gosh, what am I going to do?'”
You might think this is only happening in places with hurricanes or wildfires, but that is not the case.
Across the country, insurers are more aggressively canceling policies or jacking up rates.
A recent Consumer Reports survey found that 83% of long-term policy holders have seen their rates increase over the last five years.
“Homeowners may be forced to make trade-offs like buying substantially reduced coverage or even going without coverage,” said Lisa Gill, an investigative reporter for Consumer Reports.
Insurance industry experts point to several factors driving these changes.
Building costs are through the roof, up 40% over the last four years.
Mother Nature isn’t helping either as last year alone, weather disasters cost insurance companies $93 billion.
“There’s no place to hide. You’ll still feel this in your wallet even if you never see a hurricane or a wildfire,” Gill said. “And, in fact, rates have risen around 34% across the U.S. between 2018 and 2023.”
So, what can you do if your insurance is canceled?
Firstly, contact your insurer or broker to find out why your policy isn’t being renewed.
At the same time, start shopping around for a new policy. Consider using a local independent insurance agent or broker who works with multiple insurers. They might know about smaller companies in your state or area.
If you can’t find a private plan, there is something called Fair Access to Insurance Requirements, or FAIR plans, which are offered in nearly three dozen states.
“This type of plan should be considered a last resort. It’s not cheap, and it doesn’t cover everything, but it is better than having no insurance,” Gill said.
As for Kenyetta Twine, she was able to find a new insurance company with a little help from CR.
“I had looked at Consumer Reports Magazines, and there was an article about insurance. I’ve looked at the top ones, and then now I have insurance and no problems,” Twine said.
If you do get that cancellation notice, immediately call your insurance company and ask for more time. While they are not required to give you an extension as a courtesy, they might provide an extra 30 or even 60 days if you ask.