Home Insurance Premiums Increasing Sharply
Our auto and home insurance renewal documents arrived in the mail the other day. Last year, the cost to insure our two automobiles went up by 22 per cent and the cost to insure our home went up by 14 per cent. And when I replaced our rusty old 1992 Accord with a shiny new (relatively speaking) 2004 Accord, our auto premiums went up another 31 per cent (a part of this increase was due to the addition of comprehensive coverage). So, when our auto and home insurance renewal documents arrived in the mail the other day, I opened the envelope with some trepidation. I was hoping that 2011 wouldn’t see a repeat performance. Unfortunately, I wasn’t so lucky.
The news isn’t so bad on the auto insurance front. The changes to new and renewing auto insurance policies implemented in Ontario beginning September 1, 2010 meant that our auto premiums went up by just 7.6 per cent. The smaller increase is a direct result of a decrease in benefits for car owners who are injured in an auto accident. For example, medical and rehabilitation benefits for non-catastrophic injuries have been reduced from $100,000 to $50,000. The good news is that I was quickly able to eliminate the premium increase by boosting the deductible on direct compensation.
Home insurance turned out to be a different story. The premiums went up by 28 per cent for exactly the same coverage and same situation (no claims in the past year). I was able to get a 6 per cent discount for running what Belair Direct calls a home diagnostic (once again, showing that there is real money in some of the bill insets, so at least take a glance before chucking them away), which still means a premium increase of 20 per cent. Insurance companies are blaming increased payouts for wind and water damage due to climate change for the increase in home insurance premiums.