JEFFERSON COUNTY, Ala. (WBMA) — Inclement weather, inflation and limited building supply continue to drive home and auto insurance premiums higher. From back-to-back hurricanes to wildfires, the past few years have been challenging for the insurance industry. And Alabama homeowners will pay the price.
“Home insurance rates are up 9% this year, and auto insurance is up 18%,” explained Insurify senior editor Chris Schaefer. He said he expects this trend to continue into 2025. Alabama residents pay the seventh-highest home insurance premiums in the country, averaging $4,082.
Consider your best defense. “What many people don’t realize is that each of us has our own unique set of risk factors, and those risk factors are not judged equally by insurance companies,” Schaefer said. .
Another strategy is to invest in home improvements such as new security systems or rain-resistant shutters. Check to see if your insurance company knows about these improvements.
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And be sure to review your policy annually. Schaefer advises taking a very active role in your home insurance. Don’t just pay your insurance premium and forget about it. Your needs and opportunities to save money change.
Insurance companies are not making enough profits to feel the weight of disasters as much as they used to. The July 2024 AM Best report highlights financial strains revealing underwriting losses in 2023 reached $15.2 billion, more than double the $7.6 billion losses in 2022. . In some areas, insurance companies are exiting the market.
Alabama’s new statewide building code could help the state’s insurance market by reducing losses in new developments.
Another thing to note is that insurance companies are using drones and satellites to monitor your property. “I received a letter in the mail from Nationwide saying they were going to cancel my homeowner’s insurance because there were stripes and spots on my roof,” Don Wright said.
The family had been loyal to the company for many years, but they were abruptly laid off. The Wrights were not happy to learn that the company had been snooping around on their property.
The Insurance Information Institute points out that drones are especially useful during natural disasters. Without drones, only 10% of homes may be inspected each year.
