Why Does My Insurance Keep Going Up?
- Kate Fairley
- 5 days ago
- 2 min read
We recently ran the numbers on our home insurance portfolio, and the average increase for our clients came in at 22.9% which is in line with reports that have been filtering through the media over the past few years.
The unfortunate thing is that most of our clients live in high risk areas for bushfire and grass fire, with high building sums insured due to the cost of building, and so their premiums are already very high to begin with. Add on a 25% increase to a $3,000+ premium and you're looking at an extra $1,000 per annum which is very different from a 25% increase on a $1,000 premium.
What's not often shared in the media is that insurers have lost $4 for every $100 paid by customers for home insurance over the last 3 years, it's easy to get caught up in the headlines of insurers making massive profits but when it comes to Home Insurance they've been losing money year after year and this is the reason why home insurance premiums have continued to increase to protect the commercial viability of the product.
The exciting news is that we have seen some softening in the London market with rate reductions coming through from Lloyds, all we can do is hope that this starts to flow through to rate reductions in the Australian market so we can return to the days of 10% average increases.
Just perhaps not if you live somewhere me... because I stand alongside you in this beautiful corner of the world we call home, concerned about the future affordability of insurance.
Kate Fairley - Director, Macedon Ranges Insurance
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