An "extraordinary" number of catastrophes, the high cost of home repairs, and excessive jury awards for toxic mold claims will raise your home insurance premiums an estimated 9 percent in 2003, says the Insurance Information Institute (III). And that's on top of the 8 percent increase you're probably paying in 2002.
The III says you should also expect your auto insurance premiums to rise about 9 percent in 2003, on top of the 8.5 percent increase you're probably paying in 2002. The group blames rising medical costs, higher car-repair costs, and soaring jury awards in vehicular liability lawsuits as the main reasons for escalating rates.
Insurers have paid out more than $100 billion in catastrophe-related losses over the past 12 years, according to the III. In 2001 alone, home insurers paid out $8.9 billion more in losses and expenses than they received in premiums, the second-worst year on record since 1992 when Hurricane Andrew cost insurers $11.5 billion.
Additionally, mold claims — which were virtually unheard of two years ago — cost insurers more than $1 billion last year, approximately five times the cost in 2000. The III says other factors responsible for the increase in mold losses are "multimillion dollar jury awards, sensationalized reporting in the media, and profiteering by some individuals."
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