Auto insurance rates have been going up lately. Sugar Land, Fort Bend County,Houston are no exception. Some of our clients remark that they don’t understand why, since they haven’t had any claims, tickets or accidents. While that certainly has an impact when they occur, they aren’t the only factor in determining rates.
Just as with all other businesses, selling price is determined by costs, plus a profit. Costs to an insurance company include items common to most all businesses – payroll, taxes, rent, supplies, marketing, advertising, etc etc etc. You know that. So what’s the difference, you ask. A large component, probably the biggest of all, of an insurance company’s cost is claims expense. The amount of money paid out to policyholders and claimants when something bad happens. I’ll spare you the jargon and statistics and all that mess, but insurance is a shared risk proposition, and its impossible to pay out claims without collecting the resources to do so. That’s what your premium is for. Captain Obvious is done now...
So, when your renewal comes in the mail, and its higher than last year, its because the amount of claims expense has increased for the company.
Again, I’ll spare you the crazy details, but let’s just talk about auto insurance for a minute. Rates are up again this year, across the board of all rate categories, insurers and regions. Why, you ask again. Maybe a little bit petulantly this time?
Driving activity is way up. Gas prices are way down. Distracted and impaired driving (texting, cell phone use, as well as alcohol/chemical) has become a serious and expensive issue. In addition, repair costs of vehicles has escalated, partly due to inflation, and partly due to the proliferation of digital, electronic and sensing devices on our cars. Backup cameras, media panels, touch screens. Your bumper isn’t just a bumper anymore.
All that to say, we are an independent insurance agency for a strategic reason. We represent or broker for over 100 different carriers of all makes, shapes, sizes and colors. Different companies have different “appetites” – that’s insurance speak for who their target and/or favored markets are. So we can approach 10-12 auto carriers and 18-20 homeowners carriers to see who favors you. We’d be happy to help you search for the best value. Did you know that in some cases itsactually cheaper to get a higher liability limit on your policy?
Call us or reach out today or when you’re ready to make a change. Or when a life event occurs, such as marriage, kids move out on their own, youthful drivers, moving. We’re glad to help, and will give you some straight answers.
Call us 281-565-7550
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