4 Important Insurance Trends Consumers Need to Know
May 16, 2024The upheaval of the past few years continues to have lasting effects across industries and insurance is no exception. Coverage, endorsements, premiums, and more have all had to evolve in response to supply chain disruption, inflation, emerging risks, and other economic shifts that ultimately culminate in higher loss expenses, increased losses, and higher claim costs. As an insured, it can be difficult to keep up with it all. Here are a few important insurance trends consumers need to know:
1. There Are More Underwriting Restrictions
One of the biggest insurance trends consumers need to know is that there is a tightening of underwriting restrictions across the board. Emerging risks and increasing risks result in increases in claims in addition to higher losses and insurance companies have to adjust to accommodate those things.
In addition to rate increases, this also means that insurers have reevaluated different risks and updated their coverages to address them. In some sectors and for some insurers, this may mean new limitations on the standard coverage of a policy.
Things that used to be standard coverage may now require a special endorsement to be added. It may even be a restriction on the policy that requires an insured to explore other endorsements or lines of insurance with the underwriter in order to even get a quote for a policy, let alone full coverage.
These tightened underwriting restrictions have far-reaching effects. It can mean the markets for different types of insurance are more limited and it means that, for insureds, making sure you have sufficient coverage may look different and be more complicated when it comes time to renew insurance policies.
2. Monoline Policies Are Becoming More Limited
Although monoline policies are still available from some insurers, many insurance companies are limiting new insurance proposals for single policies. Bundling multiple insurance policies makes sense in a lot of cases. Now, it could be the new standard and not just a potential strategy for lowering premiums without sacrificing coverage.
Some insurers may no longer offer quotes for a single policy and may only consider quoting bundled policies for new insureds. In other cases, monoline policies may still be available, but the premiums associated with them may be much higher than consumers are used to seeing because of the increased risk.
From an insured’s perspective, this can make it more difficult for you to “shop around” and compare different insurance quotes as easily. Switching insurance companies could become more difficult and could certainly become less attractive if fewer options are available. If your best options for coverage are only available through insurance proposals for bundled policies, getting new quotes for coverage becomes a bigger decision that needs to be for more than just a potential discount.
An independent insurance agent is a great resource for navigating these new challenges. But, don’t be surprised if they can no longer provide an insurance proposal for just car insurance and have to bundle it with homeowner’s insurance or a renter’s policy to provide you with an accurate insurance proposal and competitive options. It’s not a bait-and-switch; it’s a necessary response to a changing industry and it may be a requirement from the available insurers.
3. Rate Increases and Higher Premiums Are Expected
With increased risks, claims, and losses, along with everything else, rate increases and higher premiums are expected across the board. Whether you are renewing a policy or getting insurance proposals to consider a new policy, you can expect higher premiums.
Higher risks, higher losses, and higher costs to recover or replace those losses mean higher coverage limits and higher premiums are needed to provide sufficient coverage in the event of a loss. If there are new restrictions for a specific type of policy, then that may require additional endorsement or separate lines to provide coverage, which also means added costs.
4. There May Be Fewer Available Discounts
Another one of the important insurance trends consumers need to know is that there may be fewer available discounts. Limited markets, increased risks, tightened underwriting restrictions, and more also mean the discounts insureds are used to seeing may no longer be available or as effective as they used to be.
Although there are still discounts for personal lines policies, they may not be the traditional discounts you’re used to seeing. For example, with underwriting restrictions and limited monoline policies, bundling multiple insurance policies may still provide a “discount” compared to the alternative, but it may not be as effective as a cost-saving strategy if it’s required to get coverage in the first place.
Make Sure You Have the Insurance You Need With Ruhl
These are just a few insurance trends consumers need to know and how they could be affecting coverage, premiums, etc. It’s important to regularly review your coverage to ensure that you remain sufficiently insured as things change. Working with an insurance agent who is hands-on with your policies and takes a consultative approach to ensure you know how you are insured and why can help.
This personalized education, consultation, and advice is one of the biggest benefits of working with an independent insurance agent and is invaluable in navigating insurance coverage and insurance industry changes. If you have questions about your insurance coverage, contact Ruhl Insurance, a Division of Horst Insurance, at 717-665-2283 or 800-537-6880.
Disclaimer: Information and claims presented in this content are meant for informative, illustrative purposes and should not be considered legally binding.