Read about a new reality in the homeowners’ insurance market.

Learn why homeowners’ insurance premiums are increasing across-the-board.

We are experiencing a new reality that will have widespread consequences for all. This new reality is dramatic change, including premium increases, in the personal lines homeowners’ insurance market. It is being driven by another reality, which is that insurance companies have been consistently paying out more dollars in homeowners’ insurance property losses than they have collected in homeowners’ insurance property premiums.

One reality follows another. Financial sustainability of the entire homeowners’ insurance market is interdependent on the losses paid out to all homeowners in the pool. The bottom line is huge and repeating property losses that have not previously been factored into rating structures have resulted in unsustainable hits to the bottom line of homeowners’ insurance companies.

Throughout more than four decades as a licensed independent insurance agent, I’ve never before seen anything like what is currently happening. Underwriting has tightened across-the-board, including on accounts that have no loss history. Some companies are raising deductibles on storm and wind damage claims to levels that are unprecedented in the homeowners’ insurance market in Ohio. To be clear, this activity does not involve a conspiracy among insurance companies. Rather, it involves an imbalance in previous rating structures with actual and repeating property losses paid out in the homeowners’ insurance market in recent years. In a nutshell, the new reality comes down to insurance companies assessing, modeling, and factoring in anticipated property losses due to: