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‘Insurers Prepare to Seek Rate Rises After Disasters’

This headline was from 1992.

Guess what — some insurance rates are still going up because of disasters due to the situation we find ourselves in today in 2021/22.

Frequency and severity of disasters are influencing insurance rates, as is the cost of replacing a home. Labor shortages and lumber and other material costs are rising.

On Christmas Eve, my daughter told me that they ordered their new kitchen cabinets now because the cost was going up 15 percent after the first of the year. So it is with every other material that goes into rebuilding a home.

Just today I also found out that the Biden administration doubled the tariff on lumber products from Canada in November. Not the smartest move at a time when raw lumber prices still remain high.

I insure with USAA, which has been advertising a lot on television. USAA is a fraternal organization, so you need to have been a veteran or the child of one to be eligible. One of the benefits of such an organization is that I get a rebate in December. This year it was only $264. In previous years it has been as high as $600.

One thing that influences that rebate is the cost of disasters that they have to pay out to members. I don’t begrudge them doing that, but it is once again reflective of the disaster cost and the insurance losses that companies are taking. Think of all those water pipes that burst in Texas. The state has a huge number of military people, both active and retired.

Of course it wasn’t just Texas that saw property damages in 2021. The last count I saw was 22 billion-dollar disasters in 2021. Hurricane Ida is projected to be the fifth most costliest hurricane on record.

Watch your mortgage statement. The increase is most likely tied to the cost of your insurance.
Disaster Zone by Eric Holdeman is dedicated to sharing information about the world of emergency management and homeland security.