There are two things that make homeowners unhappy; extreme weather events that could damage their home and rising home insurance rates. Unfortunately, Alberta has seen its fair share of flooding, sewer backups, hail, and other weather events have seen insurers pay out over $2.4 Billion in claims over the last two years, and the fact that it’s now a trend means that most homeowners across the province will see a spike in their insurance premiums.
East Village Calgary Flood 2013. Image sourced at Wikipedia Commons.
Why Do My Rates Go Up When I Haven’t Made a Claim?
While most insurers will give you a preferred rate for having a claim-free record, rates are largely determined by how many weather-related incidents your immediate neighbours – and in some cases the entire province – are having. Between extreme hailstorms in August 2012, the usual weather events, and the catastrophic floods in Alberta, many towns and cities in Alberta are considered to be higher risk by insurers. Where there is higher risk, you’ll see premium increases.
How Much Will My Rates Go Up?
Obviously we want to insurance rates to stay as low as possible, but that might not be the case in Alberta for 2014.
Heather Mack, a spokeswoman for the Insurance Bureau of Canada, said a 20% rate hike wouldn't surprise her.
Some insurance companies are trying to prevent hefty premium increases by automatically adjusting deductible amounts and making other changes to policies that reduces their risk. When it comes time to renew your policy, make sure that you go over it thoroughly with your broker to make sure that it still covers everything you want it to, and to see how you can save money.
What Can I do to Keep My Rates Down?
There isn’t too much you can do as a consumer to keep rates down in the face of extreme weather trends, beyond asking for an increased deductible. Talk to your broker to see if you can make any renovations, change out any appliances, or any other measures that can net you a reduction. You should also ask your broker to shop your policy around at renewal time, to see if you can find a better rate with another company.
Industry is Also Trying to Keep Rates Down
Insurers know that they lose customers when they raise premiums. As a result, some are being inventive and looking for ways to reclaim funds by doing things like raising deductibles on specific common damage claims, such as roofing shingles.
What’s Being Done About Alberta Extreme Weather Damage?
A provincial advisory panel recently proposed suggestions worth $830 Million to help prevent further flooding disasters in Alberta. Berms for the Elbow and Highwood rivers, rerouting the river around High River, and more of these suggestions may or may not be implemented over the next few years. Insurers are also pushing for wide changes in toughening up infrastructure and legislating use of better building materials.
If your home insurance is seeing a bump, it doesn’t matter that the bump is province-wide; it’s still worth it to shop around.
Give us a call or send us an email to see what kind of rates we can get for you. Contact us anytime!