How are increased patterns of natural disaster claims impacting my property insurance coverage?

By: Mark Koller, First Western Insurance Claims Manager

This is an understandable question for homeowners who have not had a recent claim. Yet, premiums are increasing, deductibles are increasing, and coverages are being decreased.

Increased premiums and reductions in coverage are the result of:

        • The Midwest has experienced higher-than-normal level hail and wind storms over the past several years. These storms have been unpredictable and costly in nature.
        • Repair costs have increased significantly due to increased costs of construction materials and labor.

Many of the insurers have lost significant amounts of money on property insurance. As a result, insurance companies are increasingly doing the following to ensure profitability:

        • Increased deductibles that require the homeowner/business owner to pay a larger portion of the loss.
        • No longer offering Replacement Coverage (RC) and replacing it with Actual Cash Value (ACV) coverage based on the age of the policyholder’s roof. There is an indication that replacement cost coverage will be extremely difficult to find in the near future.
        • Excluding cosmetic damage from wind and hail. This often applies to metal roofs that are visibly dented from hail but still functional as a roof.
        • Completely exiting out of writing homeowner’s coverage – several prominent insurers no longer write homeowners’ property insurance.

Our team is here to help you navigate through the rapidly changing property insurance marketplace. We are dedicated to providing valuable information and answering any questions you may have. Our main goal is to ensure our insureds have the best coverage at the most competitive rate available.

If you have any questions or need assistance, please don’t hesitate to reach out to one of your local First Western Insurance agents.