Matic, an insurtech platform, says that home insurance premiums in the US are rising faster than ever before, increasing at a record rate of 5.5% between June 2021 and May 2022.
According to Matic’s 2022 mid-year findings, which aggregated data from a random sample of 70,000 insurance policies, a premium increase of 5.5% impacts homeowners by an extra $68 on average for a 12-month policy.
This, they say, is largely due to record-high inflation rates and an uptick in severe climate and weather-related disasters.
These increases have also been driven by the rising cost of building materials and a shortage of skilled labour.
While premium increases are affecting the vast majority of American homeowners, certain groups are experiencing steeper rate hikes than others. Matic’s previous mid-year report indicated that those with lower FICO scores were disproportionately affected by rising rates, but according to 2022 data, that is no longer the case — with homeowners across all FICO groups experiencing high increases.
In fact, report findings show that people with the best credit (800 or higher) are no longer better off. While these homeowners still have better rates than those with lower FICO scores, they saw the second highest premium increase of all groups at 8.3% in only one year.
Ben Madick, co-founder and CEO of Matic, said: “Buying and owning a home is more expensive than ever in 2022, with mortgage interest rates continuing to rise and no sign that home prices will fall any time soon.”
“One small way to offset these costs is to monitor your policy, and review your rate annually to ensure you’re not overpaying. Matic allows you to compare top-rated carriers to get the best value.”