If you think it's been hard to track the weather patterns in Texas, try tracking property insurance rates and coverages. Since 2011, rates across the U.S. continue to fluctuating in the face of changes in markets, technology, and weather patterns. Texas personal and commercial property insurance are faced with the difficult proposition of remaining competitive and profitable in a state exposed to risks including: hurricanes, wild fires, flood, wind, hail, and even earthquakes;
Texas 3 largest homeowners insurance companies, State Farm, Allstate, and Farmers announced double digit rate increases to one or more of their property companies. Most recently, State Farm announced an average rate increase of 20% in it's State Farm Lloyds company. According to the Texas Department of Insurance data, State Farm Lloyds accounted for 29% of the Texas homeowners insurance market.
As a homeowner or commercial property owner, you have no control of the weather patterns. However, you can do a few things to remain ahead of the madness and uncertainty in today's environment. At your next homeowners or commerical property renewal, here are a few things to consider:
1. Evaluate your deductibles carefully. The higher your property deductible, the lower your premium. In Texas is this is especially important considering the massive number of wind & hail claims. As market conditions continue to harden, insurance companies are looking at deductible combintations on properties to determine which clients perform the best (file the least number of claims). As a result, by voluntarily increasing your deductible, your rates could drop.
2. Review your valuations for special items and inventory. Some homeowners and commercial properties alike provide limited coverage for items like TVs, and consumer electronics. If the price to replace your specially scheduled items have dropped, then perhaps you look to reduce the coverage on those items if you can.
3. Give your agent time to review and shop. In the past, people spent 15 minutes on their car insurance, 10 minutes on homeowners insurance, and 1 hour on commercial insurance. With insurance companies changine their pricing and underwriting models from experience based models to predictive scoring models, the insurance industry will continue to be somewhat unpredictable. The advents of insurance, and catastrophe scoring will make your agent work harder and do more homework for the same policies that use to take 15 minutes to quote. In this case, time is your agent's ally. Give them the time they need to properly protect your assets.
4. Bundle insurance for maximized savings. In many cases, personal and commercial insurance underwriting departments are more willing to accept a risk if the risk has more than one piece of business with the company. In personal lines, with a clean driving record and good claims experience, a person will save more money over time by insuring their home and auto insurance with the same provider. On commercial risks, completely insuring your business could provide more preferred pricing. So, including your commercial auto, workers comp, along with your property and general liability could lower your overall insurance costs.
5. Look to fill in coverage gaps. Generally, gaps in coverage occur with someone purchases their insurance through multiple outlets. Purchasing auto insurance from a call center, and homeowners insurance through your mortgage broker can be a recipe for disaster. The same holds true for commercial insurance. Insurance companies have done a good job convincing you to buy insurance through call centers and online. Generally, these types of operations are geared to handling the simplest risks. As a result, the resulting gaps in coverage could cost you money in the future.