Northern Chesapeake Insurance’s Chip Schilling offers tips on what to do if your home and auto insurance rates have increased

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Did your auto and homeowners insurance policies rates increase this year? Bel Air News & Views sponsor Chip Schilling of Northern Chesapeake Insurance says there are ways to make those rates more affordable including changing your current policy or shopping for better rates. He’s put together the following information to explain the reasons for the increases and his suggestions on how to lessen their impact. For more information, call him at 410-420-3080 or visit  www.ncins.net.

Are your auto and homeowners insurance rates increasing?

Unfortunately, one of the many ill effects of a struggling economy can be a corresponding increase in Property & Casualty Insurance claims. In bad economic times claim frequency (overall number of claims filed) and claim severity (average $’s paid-out per claim) tend to increase. The reasons for this could be due to several factors including:

– Policyholders who generally don’t file small claims are now feeling forced to do so because of limited availability of funds in their “tighter” household budget.

– Incidents of insurance fraud increase in tough economic times.

– Many consumers are carrying higher deductibles and limiting coverage on their health insurance plans as a way to help offset significant increases in their rates. In the event of an automobile accident, these higher deductibles and out-of-pocket expenses are being absorbed by the insurance companies during the auto insurance claim process.

What does this mean for you? When claim frequency and severity rise, insurance carriers will face pressure to increase rates to cover the additional claim expense. You may have already noticed an increase on your auto and homeowners insurance policies in 2011.  If you haven’t received your 2011 policy renewals, make sure that you keep an eye out for the upcoming renewal. When you do receive it, compare the rates that you paid last year to the rates offered to you for your upcoming renewal.

If your rates have increased, what can you do? Notice that I used the word “offered” above, regarding your upcoming renewal. You are not forced to accept the renewal offered to you. Consider these options:

1-      Contact your agent and price changes to your coverage that might offset these increases – for example, higher deductibles on both your auto and homeowners insurance; remove “full” (physical damage) coverage on older vehicles; check to see if you are carrying extra/optional add-ons like rental reimbursement or towing coverage and consider if you really need those.

2-      If you don’t already have your home and auto insurance in the same place, look into insuring them together with one company. Many insurers will offer substantial discounts to “package” the policies together. This doesn’t always work out to the best rate, but very often it does. Some companies will even offer discounts each time you bring another policy to them. So if you have a boat, motorcycle, etc… shop those policies at the same time as your auto and home.

3-      Make sure your policies are with a quality independent insurance agent who knows you and the area where you live. Independent agents represent several insurance companies and aren’t beholden to just one company. Therefore they work primarily for you, not the insurance company. They find the best company to fit your needs and budget, not try to fit you into one particular company’s coverage or pricing structure

If you don’t have an agent that you can count on, we can help. Call or email us today at410-420-3080 or info@ncins.net Quick and easy coverage and price evaluations that can be done right over the phone or email. We make it easy! We do the shopping for you!