Get ready for a flood of posts asking, “Why did my rates go up? I’ve never had a claim and have an 800+ credit score.”
This happens when the state doesn’t allow rate increases for years and blocks cat rating.
Emiliabouman said:
This happens when the state doesn’t allow rate increases for years and blocks cat rating.
My carrier raised rates by 20% one year and 16% the next. I’m honestly surprised CA is only getting hit with 34%.
@Alexis
I’ve seen increases as high as 90% in other states. 34% sounds low in comparison.
Emiliabouman said:
@Alexis
I’ve seen increases as high as 90% in other states. 34% sounds low in comparison.
And the rest of the country will keep covering the shortfalls. My carrier had a massive loss in CA last year, and now our state is under pressure to make up for it.
@Alexis
It’s unrealistic. My employer stopped writing new business in CA, OK, LA, and FL. And for around 15 other states, you need perfect credit, no claims, and a roof under 6 years old to even qualify. It’s nearly impossible now.
Don’t get me started on Texas. Just quoted a $14,888 premium for a home in Houston—with a contingency for hurricane shutters.
@Emiliabouman
Was that Houston home in a flood zone? Mine’s nowhere near that high and I’m not in a flood zone. That’s a crazy price!
Milan said:
@Emiliabouman
Was that Houston home in a flood zone? Mine’s nowhere near that high and I’m not in a flood zone. That’s a crazy price!
Nope, just a regular Houston neighborhood. They had a claim, and companies don’t want to take on that risk.
Emiliabouman said:
This happens when the state doesn’t allow rate increases for years and blocks cat rating.
Exactly!
Emiliabouman said:
This happens when the state doesn’t allow rate increases for years and blocks cat rating.
Right, because Texas, Florida, Georgia, Louisiana, New York, Maryland, or Oklahoma have healthy insurance markets (sarcasm).
@Kingsley
Maryland isn’t too bad if it’s not a row house in Baltimore.
The others? Might as well burn the house down and move to Ohio.
The discussion in this forum is pretty calm compared to how things usually go!
Skyler said:
The discussion in this forum is pretty calm compared to how things usually go!
Give it time. It’s only been two hours.
Skyler said:
The discussion in this forum is pretty calm compared to how things usually go!
Give it time. It’s only been two hours.
Exactly. It’s one thing to read an article, but it’s another to get that bill in the mail.
Skyler said:
The discussion in this forum is pretty calm compared to how things usually go!
No one’s seen it hit yet. That 34% increase is an average—some will see as low as 20%, others close to 50%. And that’s just the base rate. When you add in factors like dwelling characteristics, removed discounts, or claims activity, I bet the average person will see more like 40-50%. People will definitely have questions then.
Why does California choose this battle? Everything is expensive here, and yet they make it hard for insurance companies to stay in business. Allowing gradual increases over the years would’ve been better than this sudden shock.
@Sloan
Shouldn’t be an elected position in my opinion.
Penn said:
@Sloan
Shouldn’t be an elected position in my opinion.
Wouldn’t be a problem if people didn’t vote against their own best interests. But that assumes voters are informed, which is a bigger issue.
@Sloan
Big events lead to massive losses for insurers. If a company insures half of a neighborhood and the whole place burns down in a wildfire, they’re paying out on all those claims. The money has to come from somewhere. Add the rising cost of materials after COVID, and it’s no surprise they’re in recovery mode now.
@Ainsley
I understand why it’s happening. My point is that gradual increases over time would’ve been better for everyone.