Insult to Injury – After Brutal Winter Homeowners Insurance Rates Climb

The record-setting snowfall that plagued New England this winter generated a number of issues for local residents—causing delays in daily commutes and forcing children to stay home for an escalating number of snow days whether you had someone to watch them or not—and now the incessant snow of this winter is also going to cost you with your insurance company.

Insurance premiums are said to be making a huge leap of about 9 percent, which translates to an increase of about $100 on average for Massachusetts residents with premium insurance. The average is already about $1,150.

According to reports, The Massachusetts Division of Insurance has recently approved a general 8.9 percent increase for the state’s largest insurance company, Mapfre USA Corp. The increase will be effective starting on August 1st of this year. Mapfre USA Corp. insures over 214,000 homeowners in Massachusetts and previously only increased their premiums by 2.3 percent last year.

Another insurance company that is jumping on board with these increases is Safety Insurance Company. Safety Insurance Co. provides coverage to about 150,000 Massachusetts homeowners, and they plan to increase their premium rate by 9.1 percent. Their increase will not take effective until December of this year, though.

It is expected that due to these two major companies paving the way toward insurance premium rates being increased that many other insurance companies will follow in their footsteps. The weather-related events that took place this winter have led to a rise in claims made to insurance companies, which has taken a negative toll on those providing coverage. In order to compensate for this negativity—insurance providers are opting to escalate their rates.

Gallant Insurance Agency Inc. in Acton has decided to warn their customers in advance that an increase in their rates is imminent. Ray Gallant, of the Gallant Insurance Agency Inc., understands that issues of this nature are difficult for everyone involved regardless of what their position is in the whole debacle. But he believes that the immense losses that insurers suffered during this time need to be addressed to some degree.

Ray Gallant went on to say that during the height of these weather related problems; his company was receiving 75 phone calls a day or more from their customers. These phone calls detailed reports of various kinds of damage—from ice dams amassing on their property to leaky roofs, these people suffered from all different types of concerns. Gallant also said that even though two seasons have passed since this terrible winter subsided, he is still dealing with and sorting through claims made during that time.

Chris Olie, chairman for the Bunker Hill Insurance company, has said that insurers consider a variety of different matters in order to calculate the new rates expected from customers. They take into consideration not only the immediate weather that took place in prior months, but they also look into weather patterns that appeared over the past several years as well. Insurance companies also look into the rising cost of building materials for home repairs, and other factors not mentioned in order to determine the final rate before announcing their decision.

Homeowners may voice displeasure for this large increase in their rate, but it may serve to be valuable in the upcoming years if New England were to be hit by another winter like the one we just went through.


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