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Why did my insurance go up?? Let’s blame the cats!


Many have seen that dreaded increase in their renewals this year.  There are many reasons for increases but it’s really common this year because we are in, what the insurance world knows as, a “hard” market.  Simply put, many insurance companies are shying away from growing their books by competing on rates.  “We’re not chasing growth by lowering rates as we move into 2019,” Darren Godfrey – Intact’s senior vice president of personal lines, said Wednesday during their Q3 2018 earnings call.1  Why are they doing this?  There are 2 key reasons:

This is another insurance lingo.  Basically CATS are what insurance companies see as large catastrophic events, usually in the tens of millions of dollars in damages.   The news has been overwhelmed with bad news lately.  When the occurrences of these events go above a certain average, the companies start to tighten their grip.  Rates go up =(.

Loss ratio
Each insurance company lives off of this ratio.  This number tells them if they are making or losing money.  A ratio of over 100% means that the claims they paid exceeded the premiums they collected.  Guess what the ratios are looking like this year.  Many companies are experiencing losses due to a combination of factors (bad weather, fraud, etc – not to mention the new cannabis situation which I will cover in future article) but the bottom line is, they need to raise prices so they don’t lose money. =( =(

What can you do?
To weather these times, you need a good agent on your side. An agent that will take care of you by finding you the best prices for the most value.  Having an active agent means that they pick up when you need them most.  If that sounds like what you are looking for, get over to the Contact Us page and we can chat.

That’s it for now.  Dress warm and drive safe!

EC References:1. Intact Q3 Earnings Conference Call

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