Homeowner insurance rates in Iowa and nationwide are experiencing a significant surge, with some rates seeing an almost 100% increase.
Amy Curtis, a resident of Cedar Rapids, was taken aback by the sudden increase in her home insurance rate. It skyrocketed from $1,200 to $2,100, leaving her with the task of reevaluating her budget to accommodate the additional expense.
Curtis mentioned that he received his renewal notice via email, which informed him that it was time to renew his subscription. However, he was taken aback to discover that the renewal cost had increased by $1,100.
Curtis relocated to her residence in Cedar Rapids four years ago. Although she has witnessed a gradual rise in her insurance expenses, this sudden surge came as quite a surprise.
“My insurance is rolled into my mortgage payments through my bank, so I won’t be hit by that big bill,” Curtis said. “But people who don’t have that are going to be hit with way more than they expect.”
Inflation and natural disasters are causing an increase in rates throughout the country, especially in states like Iowa, where weather events are becoming more expensive and intense.
Insurance carriers are experiencing a concerning trend where they are paying out more in damages than what they are collecting in premiums, according to experts. This situation calls for Iowans to prepare themselves for the likelihood of rising costs.
“Insurance carriers are looking at our state because of the frequent storms, which cause a lot of claims. That is factoring into their decision on whether to write policies in the state,” said Sonya Sellmeyer, a consumer advocate at the Iowa Insurance Division.
Experts are optimistic that homeowners will not experience another significant increase in the coming year, as the economy continues to stabilize.
According to Martin Grace, a finance professor at the University of Iowa, it is likely that the pressure is easing or will ease in the near future. He believes that the economy is on the verge of returning to normalcy, with the Federal Reserve already reducing interest rates and potentially reducing them further. This is a positive indication that inflation is also decreasing.
Iowans like Curtis are discovering innovative ways to live within their financial limitations.
“Just trying to cut back on eating out for dinner and opting to cook at home more often. But the most important thing is not to panic. I’m currently exploring different insurance agencies and opportunities to bundle my car and home insurance,” Curtis explained.
Experts strongly recommend homeowners insurance as an essential protection. If the cost is a concern, it is advisable to consult with an insurance agent to discuss possible alternatives.