Inflation and it's impact on Insurance

[OldSoulon]

Who are you with? I called a buddy that owns a bunch of properties. He mentioned an increase of 10% from State Farm.

That is with Grange. It just renewed this month but I am switching soon to another company, same annual premiums, but a $1,500 deductible.

My agent is getting back to me, can't remember the name of the insurer.

Progressive was actually cheaper, but he said they do their homeowners through a third party, so I'm a little leery of that.

 

[I enjoy wrestling]

Have a property where policy went from $22K to $38K. Of course I looked elsewhere. Found out most companies aren't writing new policies anymore. If they do, building has to be less than 20 years and with a new roof. Yup, rent is going up.

Crazy stuff and it just gets passed on for some of us.

 

[OldSoulon]

My gulf front home insurance is outrageous. It is all DeSantis’s fault.

More like you live in a hurricane zone.

Plus, double wides are flimsy, and blow right over in those storms.

 

[OldSoulon]

Let's see, houses are high, gas is high, groceries are high, salaries are as high as ever. This is all just part of the big games folks. No one ever has enough money. Yes, if housing prices are high, building materials are high, then yes, to replace that house, it's going to cost more. Makes sense to me.

But vote for Biden, he'll let you freely abort, and forgive your student loans.

 

[I enjoy wrestling]

That is with Grange. It just renewed this month but I am switching soon to another company, same annual premiums, but a $1,500 deductible.

My agent is getting back to me, can't remember the name of the insurer.

Progressive was actually cheaper, but he said they do their homeowners through a third party, so I'm a little leery of that.

I have a broker looking into ours. Grange and Progressive grade out well in a report I read.

 

[ProV1]

More like you live in a hurricane zone.

Plus, double wides are flimsy, and blow right over in those storms.

So probability and size of claim raises rates? Who knew?

 

[OldSoulon]

I have a broker looking into ours. Grange and Progressive grade out well in a report I read.

I was with Westfield for about thirty years, then two years ago, they jacked up their rates to a crazy level.

Been with Grange since then, haven't had to make a claim.

 

[I enjoy wrestling]

I was with Westfield for about thirty years, then two years ago, they jacked up their rates to a crazy level.

Been with Grange since then, haven't had to make a claim.

Same situation with Hanover. I actually have perfect credit and no claims. Real head scratcher!

 

[playboi12]

We told our previous carrier to kick rocks. We like our provider now. The hikes on all these are absurd.

 

[Sykotyk]

I've been with State Farm. I know a lot claim there's a track record with them having issues with claims, but I haven't in all that time. In that time, I had a comp claim for glass (tree branch fell on my rear window while parked), another comp claim for glass (rock chip/crack in a windshield of another vehicle), another comp claim when ice fell onto my Cadillac and dented the body above the driver's door, totaled van in December thanks to Bambi, and another van totaled thanks to my dad in February. My insurance went up from $60/mo to 80/mo on my pickup, but my house stayed level from last year to this year.

I've shopped around, but the price has never been enough to switch. And I've got higher than minimum coverage on every vehicle I've owned. So, that might be part of why I've had a better history with them than some people have had. Who knows.

 

[14Red]

I've been with State Farm. I know a lot claim there's a track record with them having issues with claims, but I haven't in all that time. In that time, I had a comp claim for glass (tree branch fell on my rear window while parked), another comp claim for glass (rock chip/crack in a windshield of another vehicle), another comp claim when ice fell onto my Cadillac and dented the body above the driver's door, totaled van in December thanks to Bambi, and another van totaled thanks to my dad in February. My insurance went up from $60/mo to 80/mo on my pickup, but my house stayed level from last year to this year.

I've shopped around, but the price has never been enough to switch. And I've got higher than minimum coverage on every vehicle I've owned. So, that might be part of why I've had a better history with them than some people have had. Who knows.

State Farm has to pay Caitlin Clark and Patrick Mahomes. How do these insurance companies justify paying celebrities and then jacking up rates?? I guess because much of America doesn't even pay attention to what their insurance costs, they just pay it.

 

[I enjoy wrestling]

We told our previous carrier to kick rocks. We like our provider now. The hikes on all these are absurd.

Who are you with?

 

[ProV1]

Inflation has very little to do with insurance rates, today. 2022 was a big year for losses and the industry is making up and going into gouge mode. Progressive just posted a 421% increase in net income. Look up the results for your favorite carrier.

 

[I enjoy wrestling]

Inflation has very little to do with insurance rates, today. 2022 was a big year for losses and the industry is making up and going into gouge mode. Progressive just posted a 421% increase in net income. Look up the results for your favorite carrier.

View attachment 57495

Hmm Can you keep digging? State Farm? Need bigger time-lines. Hanover was needing to perform for shareholders. But, the inflationary aspect is real. You think price gouging is the reason for increases? I'm listening

 

[I enjoy wrestling]

 

[ProV1]

Hmm Can you keep digging? State Farm? Need bigger time-lines. Hanover was needing to perform for shareholders. But, the inflationary aspect is real. You think price gouging is the reason for increases? I'm listening

Inflation is 3% YoY. That is 1% over historical acceptable. How big are the insurance increases you are seeing? Look up the net income growth in the last year or two for your favorite carrier. I will be listening to your explanation becasue mine is self explanatory.

 

[I enjoy wrestling]

To find annual inflation rates for a calendar year, look to the December column. For instance, the inflation rate in 2023 was 3.4%. Meanwhile, the "Ave" column shows the average inflation rate for each year using CPI data. In 2023, the average inflation rate was 4.1%. These average rates are published by the BLS but are rarely discussed in the news media, taking a back seat to the actual rate of inflation for a given calendar year.

Year​

Jan​

Feb​

Mar​

Apr​

May​

Jun​

Jul​

Aug​

Sep​

Oct​

Nov​

Dec​

Ave​

2024​

3.1​

3.2​

3.5​

Avail. May 15​

​

​

​

​

​

​

​

​

​

2023​

6.4​

6.0​

5.0​

4.9​

4.0​

3.0​

3.2​

3.7​

3.7​

3.2​

3.1​

3.4​

4.1​

2022​

7.5​

7.9​

8.5​

8.3​

8.6​

9.1​

8.5​

8.3​

8.2​

7.7​

7.1​

6.5​

8.0​

2021​

1.4​

1.7​

2.6​

4.2​

5.0​

5.4​

5.4​

5.3​

5.4​

6.2​

6.8​

7.0​

4.7​

2020​

2.5​

2.3​

1.5​

0.3​

0.1​

0.6​

1.0​

1.3​

1.4​

1.2​

1.2​

1.4​

1.2​

2019​

1.6​

1.5​

1.9​

2.0​

1.8​

1.6​

1.8​

1.7​

1.7​

1.8​

2.1​

2.3​

1.8​

2018​

2.1​

2.2​

2.4​

2.5​

2.8​

2.9​

2.9​

2.7​

2.3​

2.5​

2.2​

1.9​

2.4​

2017​

2.5​

2.7​

2.4​

2.2​

1.9​

1.6​

1.7​

1.9​

2.2​

2.0​

2.2​

2.1​

2.1​

2016​

1.4​

1.0​

0.9​

1.1​

1.0​

1.0​

0.8​

1.1​

1.5​

1.6​

1.7​

2.1​

1.3​

 

[ProV1]

To find annual inflation rates for a calendar year, look to the December column. For instance, the inflation rate in 2023 was 3.4%. Meanwhile, the "Ave" column shows the average inflation rate for each year using CPI data. In 2023, the average inflation rate was 4.1%. These average rates are published by the BLS but are rarely discussed in the news media, taking a back seat to the actual rate of inflation for a given calendar year.

Year​

Jan​

Feb​

Mar​

Apr​

May​

Jun​

Jul​

Aug​

Sep​

Oct​

Nov​

Dec​

Ave​

2024​

3.1​

3.2​

3.5​

Avail. May 15​

​

​

​

​

​

​

​

​

​

2023​

6.4​

6.0​

5.0​

4.9​

4.0​

3.0​

3.2​

3.7​

3.7​

3.2​

3.1​

3.4​

4.1​

2022​

7.5​

7.9​

8.5​

8.3​

8.6​

9.1​

8.5​

8.3​

8.2​

7.7​

7.1​

6.5​

8.0​

2021​

1.4​

1.7​

2.6​

4.2​

5.0​

5.4​

5.4​

5.3​

5.4​

6.2​

6.8​

7.0​

4.7​

2020​

2.5​

2.3​

1.5​

0.3​

0.1​

0.6​

1.0​

1.3​

1.4​

1.2​

1.2​

1.4​

1.2​

2019​

1.6​

1.5​

1.9​

2.0​

1.8​

1.6​

1.8​

1.7​

1.7​

1.8​

2.1​

2.3​

1.8​

2018​

2.1​

2.2​

2.4​

2.5​

2.8​

2.9​

2.9​

2.7​

2.3​

2.5​

2.2​

1.9​

2.4​

2017​

2.5​

2.7​

2.4​

2.2​

1.9​

1.6​

1.7​

1.9​

2.2​

2.0​

2.2​

2.1​

2.1​

2016​

1.4​

1.0​

0.9​

1.1​

1.0​

1.0​

0.8​

1.1​

1.5​

1.6​

1.7​

2.1​

1.3​

So I will use your January numbers. 2021-2024 inflation totals 20%. 2017-2020 is 8.7%. The difference is 11.3%. Is your complaint that your insurance premiums have gone up 8.7% more over 4 years? If so, sign me up. My guess is that they are 50+% higher while net income is exploding with the carriers. HMM…. Does not take a rocket scientist, does it?

 

[I enjoy wrestling]

Does not take a rocket scientist, does it?

The investment pressures

Inflation: 2022’s biggest threat to insurance investment portfolios?

SLC Management is a group of specialized global asset managers focused on delivering a diverse range of traditional and yield-oriented asset classes, building client solutions and investing sustainably.

www.slcmanagement.com

 

[I enjoy wrestling]

This one is right down your alley. DEI man

Social Inflation

content.naic.org

 

[playboi12]

Who are you with?

We are with State Farm now. We combined home/auto and casualty and got a good deal. Definitely shop around.

 

[TylerDurden]

Hmm Can you keep digging? State Farm? Need bigger time-lines. Hanover was needing to perform for shareholders. But, the inflationary aspect is real. You think price gouging is the reason for increases? I'm listening

Correct, but this is what the guy does. There's no way he spent any significant time in business doing forecasting, budgets, financials, etc.

To your point, I'm guessing if you take a look at Progressives profits from prior years they'll tell a story as to why the numbers look like they do. Just looking at financials in the timeframe of a year, or quarter, with no frame of reference is idiotic, especially having the hindsight of knowing what was unknown at the time decisions are being made (claims, inflation, etc).

Of course maybe he's right and insurance companies across the board illegally got together and ALL decided to jack up rates so they can make money in the short term and none of them had enough sense to keep rates reasonable and pull in additional/new business.

 

[I enjoy wrestling]

Correct, but this is what the guy does. There's no way he spent any significant time in business doing forecasting, budgets, financials, etc.

To your point, I'm guessing if you take a look at Progressives profits from prior years they'll tell a story as to why the numbers look like they do. Just looking at financials in the timeframe of a year, or quarter, with no frame of reference is idiotic, especially having the hindsight of knowing what was unknown at the time decisions are being made (claims, inflation, etc).

Of course maybe he's right and insurance companies across the board illegally got together and ALL decided to jack up rates so they can make money in the short term and none of them had enough sense to keep rates reasonable and pull in additional/new business.

There is some truth to his price gouging theory. But, inflationary trends provide cover for these companies. Biden owns this horrible inflationary period. He just can't stop being a lib and living on the Plantation.

 

[ProV1]

The investment pressures

Inflation: 2022’s biggest threat to insurance investment portfolios?

SLC Management is a group of specialized global asset managers focused on delivering a diverse range of traditional and yield-oriented asset classes, building client solutions and investing sustainably.

www.slcmanagement.com

You are repeating the same thing. Claim costs. I have addressed that. Claim costs have risen but nowhere near the rates of premium increase leading to astronomical growth in net income. Did you not read my response to your inflation chart?

 

[ProV1]

Correct, but this is what the guy does. There's no way he spent any significant time in business doing forecasting, budgets, financials, etc.

To your point, I'm guessing if you take a look at Progressives profits from prior years they'll tell a story as to why the numbers look like they do. Just looking at financials in the timeframe of a year, or quarter, with no frame of reference is idiotic, especially having the hindsight of knowing what was unknown at the time decisions are being made (claims, inflation, etc).

Of course maybe he's right and insurance companies across the board illegally got together and ALL decided to jack up rates so they can make money in the short term and none of them had enough sense to keep rates reasonable and pull in additional/new business.

Look up the carrier of your choice. They will not all have the same results but premium increases are massively outpacing inflation. Some have continued to struggle but by their own explanation, claim severity (Florida as an example) is the reason and not inflation. The evidence is in their own financial disclosures not in anything you made up. See State Farm.

Bloomington, IL, February 29, 2024 — In 2023, State Farm property and casualty insurance companies experienced growth in policies while also reporting underwriting losses due to continued elevated claims severity and significant catastrophe activity, for both the auto and homeowners insurance companies.

 

[ProV1]

There is some truth to his price gouging theory. But, inflationary trends provide cover for these companies. Biden owns this horrible inflationary period. He just can't stop being a lib and living on the Plantation.

Biden owns global inflation no more than Trump does. I am still waiting on Trumps plan to lower inflation. Can you share?

 

[Orin Swift]

Inflation in insurance is a thing, but we’re about 2 years late on it being a talking point. CAT weather and nuclear verdicts causing paying outs in the millions that a similar loss 5 ago wouldn’t come close to touching the umbrella limits are the biggest pushers in premium increases. Not to mention even fender benders are $5k-$10k in repairs with all the cameras, sensors, technology in the bumpers. That was like a $2k repair 10 years ago.

 

[I enjoy wrestling]

You are repeating the same thing. Claim costs. I have addressed that. Claim costs have risen but nowhere near the rates of premium increase leading to astronomical growth in net income. Did you not read my response to your inflation chart?

Read the entire article!

 

[ProV1]

Read the entire article!

I did. The fact remains, inflation is a secondary element in the large premium hikes. I gave you examples of both huge profits and losses where the company itself directly attributes the losses to “claim severity and catastrophe activity”. As I also clearly stated, inflation the last 4 years has been 11% higher than what has been historically acceptable. You can make things up or you can look at the actual data and listen to what the carriers actually say.

 

[I enjoy wrestling]

I did. The fact remains, inflation is a secondary element in the large premium hikes. I gave you examples of both huge profits and losses where the company itself directly attributes the losses to “claim severity and catastrophe activity”. As I also clearly stated, inflation the last 4 years has been 11% higher than what has been historically acceptable. You can make things up or you can look at the actual data and listen to what the carriers actually say.

And you're voting for Biden.