By Sandra Bullock from Kiplinger’s personal finances
Todd Jackson, chairman of Independent Insurance Agent and American broker, discusses the possible 2025 home and car insurance scenarios.
Question: Consumers have seen a sharp rise in homeowners’ premiums and car insurance in recent years. What is behind the increase?
Answer: There are several factors. Before 2022, the insurance market went through a lower than usual stage of hurricane activity. However, hurricane activity actually surged in 2022 and 2023, coinciding with rising inflation in many different sectors that affected the homeowner insurance industry. Looking at the consumer price index for all consumer goods, prices rose by about 20% overall between 2020 and 2024. However, the construction industry has become much more intense. Other things you need to replace and repair your home. In other words, the impact of inflation on goods and services affecting the insurance industry is increasing at about twice as much as other industries. The results showed that these costs were being passed on to the customer.
The automotive industry also had supply chain issues early in the Covid-19 pandemic that leaked in 2021 and 2022. During that period, the costs of parts and consumables rose dramatically, along with the cost of repairing the vehicle. The time required to repair your vehicle is also increasing, increasing the needs and costs of a rental car, and the overall cost of repairs. These increases in costs still exist today and are being passed on to insurance customers.
Question: What is the outlook for insurance prices for 2025?
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Answer: Overall pricing may not be lower, but the rate of growth in automobile insurance, especially as the supply chain has improved, appears to be levelled. Insurance companies were beginning to see improvements in the financial situation of insurance properties in the first three quarters of 2024, but the coming of Hurricane Helen and Milton in the fall of 2024 has been rather dramatic, and some kind of thing It may be effective. Homeowner Insurance Prices for next year.
Question: Will insurance companies continue to leave the state that suffered from natural disasters and narrow their access to homeowner insurance for residents?
Answer: All indicators of the real estate market seem to suggest that they will continue to be difficult. Florida people are used to retired insurance companies, but now we see it happening in the Midwest and Plains states. Working with independent agents who can offer options from multiple insurance companies, homeowners have a better opportunity for carriers to find coverage when they leave their area.
Q: What steps can car owners and homeowners take to reduce their premiums?
Answer: When it comes to car insurance, you will mostly impact premiums by practicing safe driving habits and doing everything you can to prevent losses. Having a credit score is also helpful. This is because credit has an impact on carrier price insurance in recent decades.
Proper maintenance (roof, plumbing, electricity, HVAC) in your home is paramount for homeowners. I would also like to check the deduction amount and decide whether I can afford to pay before the insurance begins. If you increase your home and car insurance deduction, your insurance company will reward you with a lower premium to undertake a higher portion of the risk.
You can also save money by bundling your car and home insurance with the same company. As an independent insurance agent, I may work with 15 different carriers. Looking at them with individual silos, insurance company A can offer the cheapest homeowner insurance, and insurance company B can offer the cheapest car insurance. However, insurance company C may offer the lowest overall premium if you purchase both policies.
©2025 The Kiplinger Washington Editors, Inc. was distributed by the Tribune Content Agency, LLC.
The views and opinions expressed are those of the author. They are for general informational purposes only and should not be interpreted or interpreted as recommendations or solicitations. Epoch Times does not provide investments, taxes, legal, financial planning, real estate planning, or other personal financial advice. Epoch Times is not responsible for the accuracy or timeliness of the information provided.
