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Ohio auto club warns of insurance increases
KEITH ARNOLD
Special to the Legal News
Published: April 14, 2022
It should come as no surprise to Ohio motorists and homeowners that insurance rates are expected to climb just as inflation reaches levels not seen for generations.
AAA Ohio Auto Club Insurance Agency recently announced that consumers should be paying more for premiums in the coming years as home and auto insurance rates rise.
“With more than 7 percent overall inflation in the U.S., the average homeowners and auto insurance claim costs have jumped as much as 30 percent,” AAA Ohio Auto Club vice president of Insurance and Financial Services Brad Oltmans said in prepared remarks. “As insurance carriers take on more costly claims, they spread that cost out across their customer base, and consumers see this in the form of higher premiums.”
The independent insurance agency noted that consumers are seeing their auto insurance premiums up about 5 percent and their homeowners insurance premiums up between 10 and 15 percent.
The increase in homeowners policies reflects both a rise in the base premium and the inflation coverage added to every policy.
In addition to inflation, several factors are driving up both auto and home insurance rates, perhaps most notably are supply chain issues, the agency reported.
The price of raw materials have gone up due to issues in the supply chain, agency officials said. Consequently, the value of a vehicle and replacement costs for the home have also risen, and insurance carriers pass the higher costs on to their customers.
The other contributing factors are distracted driving and advanced technology built into today’s cars, such as rear cameras and back-up sensors.
“Insurance companies have different rates for different customers,” said Oltmans. “They base an individual’s rate on that person’s risk. The best way to reduce your rate is to reduce your risk.”
Most discounts are calculated up front, he said. Consumers may be able to offset rising rates, however, by asking their agent to review their policy and seeing if they’re eligible for any discounts. For auto insurance, these might include discounts for:
• Vehicle features such as a rearview camera or anti-theft system;
• Buying auto and home coverage from the same carrier;
• Completing a driver training course;
• Insuring a youthful driver with a “B” or better grade point average;
• Renewing with the same insurance carrier for several years; and
• Paying your annual premium in full or by automatic withdrawal.
Additionally, many carriers offer telematics or usage-based insurance to reward people for safe-driving habits. This is typically in the form of an app that monitors driving habits for a test period and offers discounts based on driving habits.
For home insurance, items such as swimming pools, trampolines and certain dogs increase risk, agency officials said. Additionally, the farther away one lives from the nearest full-time responding fire department, or fire hydrant, the higher their risk.
Operating a business out of the home also may impact risk.
“If you’re unsure, it’s a good idea to talk with your insurance agent to see if there are options to minimize your risk and your annual premiums,” said Oltmans. “Those that still feel they’re paying too much can always shop around for a policy that fits their needs and budget.”
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