Understanding Rising Insurance Rates: What You Need to Know

Steven Skarpa • June 19, 2024

Insurance rates are a common concern for homeowners and businesses alike. Over the past few years, many policyholders have noticed an increase in their premiums. At Skarpa Insurance Agency, we understand the frustration that comes with rising insurance costs. As a Trusted Choice Independent Agency, we are committed to helping our clients understand the factors driving these increases and finding the best solutions to meet their needs.


The Factors Behind Rising Insurance Rates


Several factors contribute to the rising cost of insurance. By understanding these factors, you can better navigate the changes and make informed decisions about your coverage. Here are some of the key reasons why insurance rates are increasing:


1. Increased Frequency and Severity of Natural Disasters


Natural disasters such as hurricanes, floods, wildfires, and tornadoes have become more frequent and severe in recent years. These events result in substantial claims payouts by insurance companies, which, in turn, drive up the cost of premiums for policyholders. For residents of Liberty County, TX, hurricanes and floods are particularly relevant, leading to higher rates for home and flood insurance.


2. Rising Construction and Repair Costs


The cost of building materials and labor has been steadily increasing. When insurance companies have to pay out claims for property damage, the higher costs of construction and repair are factored into the premiums. This means that even if you haven't filed a claim, you might see an increase in your rates due to the overall rise in costs within the industry.


3. Increased Reinsurance Costs


Reinsurance is the insurance that insurance companies purchase to protect themselves from significant losses. When natural disasters occur, reinsurance companies also face substantial payouts. As a result, the cost of reinsurance has increased, and these higher costs are passed down to policyholders through increased premiums.


4. Higher Claim Payouts


Insurance companies are experiencing higher claim payouts across various types of insurance, including home, auto, and health insurance. This increase is due to a combination of factors, including more expensive repairs, higher medical costs, and an overall rise in the frequency and severity of claims. To maintain financial stability, insurers adjust premiums accordingly.


5. Changes in Risk Assessment Models


Insurance companies use complex risk assessment models to determine the likelihood of claims and set premiums. As new data becomes available and technology advances, these models are continuously updated. Changes in risk assessment can lead to adjustments in premiums, especially if new information indicates a higher risk of loss.


6. Inflation


Inflation affects all sectors of the economy, including insurance. As the cost of goods and services rises, so do the costs associated with insurance claims. This increase in expenses is reflected in higher premiums for policyholders.


Managing Rising Insurance Rates


While rising insurance rates can be challenging, there are several strategies you can employ to manage costs and ensure you have the coverage you need:


1. Review and Update Your Coverage


Regularly review your insurance policies to ensure they still meet your needs. Consider updating your coverage to reflect any changes in your property, lifestyle, or risk factors. Adjusting your coverage limits and deductibles can help you find a balance between adequate protection and affordable premiums.


2. Shop Around


As an independent agency, Skarpa Insurance Agency has access to multiple insurance carriers and can help you compare quotes to find the best rates. Shopping around for insurance allows you to take advantage of competitive pricing and find policies that offer the best value for your specific needs.


3. Bundle Policies


Many insurance companies offer discounts for bundling multiple policies, such as home and auto insurance. Bundling can provide significant savings and simplify the management of your insurance coverage.


4. Improve Your Home’s Resilience


Taking steps to make your home more resistant to damage can reduce your insurance premiums. This includes installing storm shutters, reinforcing your roof, and upgrading your home’s security system. Insurance companies often offer discounts for proactive measures that lower the risk of claims.


5. Maintain a Good Credit Score


In many states, including Texas, insurance companies consider your credit score when determining premiums. Maintaining a good credit score can help you secure lower rates. Pay your bills on time, reduce outstanding debt, and monitor your credit report for any errors.


6. Ask About Discounts


Insurance companies offer various discounts that can help reduce your premiums. These may include discounts for installing safety features, being claims-free for a certain period, or being a loyal customer. Ask your insurance agent about any discounts you may qualify for.


7. Consider Higher Deductibles


Choosing a higher deductible can lower your premiums. However, it’s essential to ensure you can afford the out-of-pocket expense in the event of a claim. Evaluate your financial situation and choose a deductible that provides a balance between lower premiums and manageable risk.


The Role of Skarpa Insurance Agency


At Skarpa Insurance Agency, we are committed to helping our clients navigate the complexities of rising insurance rates. As a Trusted Choice Independent Agency, we work with multiple insurance carriers to find the best coverage options at competitive prices. Our team is dedicated to providing personalized service and ensuring you have the protection you need.


Rising insurance rates are influenced by a variety of factors, including natural disasters, increased repair costs, and changes in risk assessment models. While these increases can be challenging, there are strategies you can employ to manage costs and ensure you have adequate coverage. At Skarpa Insurance Agency, we are here to help you understand the factors driving premium increases and find solutions that fit your needs. Contact us today to review your insurance policies and explore options for managing your premiums effectively.

Hurricane Preparedness: Key Steps to Stay Safe During the Season

September 11, 2024
As we find ourselves in the heart of hurricane season, it's important to stay prepared for potential evacuations or emergency situations. One of the most crucial steps in this process is assembling a hurricane preparedness kit or "go bag" that you can easily grab if you need to leave your home quickly. Here are some practical tips for creating a go bag that will ensure you're ready for any situation. Choosing the Right Bag Start by selecting a small, portable, lightweight backpack or even a suitcase with wheels. This will make it easier to carry your supplies if you need to move quickly. The goal is to keep the bag compact and easy to transport, while still ensuring it holds all the essential items you’ll need. What to Pack in Your Go Bag Your go bag should include the following essential items, designed for a quick evacuation: Hand sanitizer, face masks, and sanitary wipes to maintain hygiene. Layered clothing and toiletries. Backup eyeglasses, bug spray, matches, and a multipurpose tool. First aid kit and prescription medications. Emergency cash and copies of house and vehicle keys. Bottled water and nonperishable foods like granola or energy bars. Photocopies of essential documents (such as proof of address, driver’s license, insurance, Social Security cards, and medical records) stored in a waterproof bag. It's also a good idea to include your phone charger and, when you're ready to leave, your phone itself. However, try to use your phone sparingly to conserve the battery during an emergency. Sheltering in Place If you may need to shelter in place, your emergency kit should include enough supplies to last up to two weeks. This kit should be more comprehensive and stored in a large plastic container in a designated spot for easy access. Be sure to include: Dried and canned foods, along with sufficient water. Prescription medications and a first aid kit. Personal hygiene items like toothpaste, soap, and sanitary products. Don’t Forget Your Pets If you have pets, be sure to create a dedicated emergency kit for them as well. Include:  A pet carrier for each pet, labeled with your contact information. Two weeks’ worth of food and water. Litter for cats or poop bags for dogs. Copies of your pets' medical records, including their vaccination status. Being prepared for hurricanes is about more than just having the right insurance coverage—it's about having the right supplies and planning ahead to ensure your safety. Having a well-packed go bag and emergency supplies can help you navigate this hurricane season with peace of mind. For any questions about how your insurance coverage may protect you during this time, don't hesitate to reach out to Skarpa Insurance Agency.

Navigating Flood Season and Spring Storms: Essential Tips for Liberty County Residents

By Steven Skarpa • May 16, 2024
Flood season and spring storms are annual occurrences that can pose significant risks to homeowners in Liberty County, TX. These natural events can lead to extensive property damage and create hazardous conditions. At Skarpa Insurance Agency, we are committed to helping our community prepare for and respond to these challenges. As a Trusted Choice Independent Agency, we offer customized insurance solutions to meet your unique needs. Understanding Flood Season and Spring Storms Flood season typically coincides with spring, when melting snow and heavy rainfall can cause rivers and streams to overflow. Additionally, spring storms can bring high winds, hail, and tornadoes, further increasing the risk of damage to your property. Understanding these risks and taking proactive measures can help you protect your home and family. Preparing for Flood Season Know Your Flood Risk: Determine if your property is located in a flood-prone area by consulting FEMA flood maps or contacting local authorities. Understand the different types of flooding that can occur, such as riverine flooding, flash flooding, and urban flooding. Purchase Flood Insurance: Standard homeowners insurance typically does not cover flood damage, so it’s essential to have a separate flood insurance policy. Contact Skarpa Insurance Agency to discuss your flood insurance options and ensure you have adequate coverage. Create a Flood Emergency Plan: Develop a plan that includes evacuation routes, a safe meeting place, and an emergency kit with essentials such as water, food, medications, and important documents. Ensure all family members know the plan and practice it regularly. Protect Your Property: Elevate utilities such as water heaters, furnaces, and electrical panels to reduce the risk of flood damage. Install sump pumps with battery backup systems to help keep your basement dry. Use water-resistant building materials and seal basement walls to prevent water infiltration. Preparing for Spring Storms Inspect and Maintain Your Home: Conduct regular inspections of your roof, windows, doors, and siding to identify and repair any vulnerabilities. Trim trees and remove dead branches to reduce the risk of damage from falling limbs. Secure Outdoor Items: Bring patio furniture, grills, and other outdoor items indoors during severe weather to prevent them from becoming projectiles. Anchor larger items that cannot be brought inside, such as sheds and playsets. Install Storm Protection: Consider installing storm shutters or impact-resistant windows to protect against high winds and flying debris. Reinforce your garage door to prevent it from being blown in during strong winds. Stay Informed: Monitor weather reports and sign up for local alerts to receive timely updates about severe weather conditions. Have a battery-powered weather radio on hand in case of power outages. During the Storm Stay Indoors and Safe: Avoid going outside during the storm, even if it appears calm. Stay away from windows and doors to avoid injury from flying debris or broken glass. Use Battery-Powered Devices: Keep flashlights and battery-powered radios handy to stay informed if the power goes out. Avoid using candles, as they pose a fire risk. Keep Communication Open: Ensure your cell phone is fully charged before the storm and have a backup battery or charger available. Inform family and friends of your location and safety status regularly. After the Storm Assess Damage Safely: Wait for official clearance before venturing outside to assess damage. Be cautious of downed power lines, flooding, and other hazards. Document Damage: Take photos and videos of any damage to your property for insurance purposes. Contact your insurance provider to report the damage and initiate the claims process. Prioritize Repairs: Address immediate hazards first, such as broken windows or roof leaks. Work with reputable contractors to make necessary repairs and avoid scams from fraudulent service providers. Flood season and spring storms can pose significant risks to homeowners in Liberty County. However, with proper preparation and the right insurance coverage, you can protect your home and family from the devastating effects of these natural events. At Skarpa Insurance Agency, we are here to help you navigate the complexities of flood and storm preparedness and ensure you have the coverage you need. Contact us today to review your insurance policies and make sure you are ready for whatever the season may bring.