But not all the factors that go into the cost of your policy are about you.
Insurance by nature is a group venture. Everyone who buys a policy from your provider is part of that group.
In this blog, the Keating Agency will explain another element that goes into pricing a policy.
Insurance Costs Impacted by Loss Ratio
Ryan Keating is a third-generation member of Keating Agency Insurance. He recently wrote an article about the impact loss ratio can have on insurance costs. This is the difference between the money your insurer collects in premiums and what it pays out in claims and dividends.
This table from our friends at the Insurance Information Institute breaks down the expense versus premium ratio for Homeowners and Renters Insurance for 2018. Because the ratio is over 100, the insurance companies lost money. The natural pattern following this would be to increase premiums the next year.
Additionally, insurance companies may adopt policies to tighten the purse strings on payouts. High-cost claims may trigger more stringent audits.
If you are someone who never submitted a claim on any of your insurance policies, paying for others’ claims could seem unfair. But, as we mentioned earlier, insurance by nature is a group venture. Policies represent a shared risk.
If you feel the shared reward you receive is not worth the shared risk on any of your insurance policies, give us a call. The Keating Agency has been your local, independent insurance agency for more than 50 years. We attribute our longevity to our commitment to you, our policy holders.
The Keating Agency is your friend and neighbor. We are here for you.