Part of what is driving up the cost is the increased cost of claims. The cost of parts and construction materials has increased. The cost of labor has gone up. If companies are paying staff more, that is passed on to us consumers. Parts are also on backorder and the length of time to repair cars or homes is taking longer. Companies are having trouble finding people to work. Therefore, it takes longer to get repairs completed because the labor isn’t there. The longer a car is getting repaired, the longer someone needs a rental car.
Let’s look at the medical side. When was the last time you received a medical bill and realized the cost of a Band-Aid? Okay, that may have been included and was thrown in there to see if you were still paying attention, but you get where I am going with this. Medical costs are rising.
When someone is injured in an accident, it costs more to make them better. People are getting injured on the job. Some appear to be finding ways to get injured on the job and to fight to prove how that injury truly came about costs an insurance company money. And sometimes they pay when it doesn’t seem fair.
Think about home claims. Have you ever had a friend say something that made you uncomfortable about a claim they were going to file because you know it seemed wrong? That’s called fraud and it is wrong. They can get in a lot of legal trouble, including jail, if they are caught. When they get caught, the insurance company will likely cancel them and as an independent agent we can’t find another company who will insure someone who has been cancelled by another insurance company for that reason. We can’t lie on an application on behalf of someone either, and yes, we’ve been asked. We are asked to commit fraud often and people don’t realize they are even asking us to do so. Most of the time it is out of innocence, but we have to do what’s right and ethical.
Another thing to note is uninsured and underinsured motorist claims are on the rise. We highly recommend looking at your limits and making sure you have this coverage to protect yourself against those who don’t have insurance.
Many other factors are causing rates to go up. A lot of these things are out of our control and because claims are on the rise and costs of each claim are on the rise, we are all impacted.
