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I wanted to give you an update of the state of the economy and insurance business. This week I was in Kearney for the Big I’s Insurance Spring convention. The big topic was the market with insurance in the state of Nebraska, and in the country. One of the speakers was the president of one of the insurance companies talking about reinsurance.
Reinsurance is what insurance companies buy to insure their business. He said, last year and this year, reinsurance has gone up 30%. So that’s a 30% increase on the insurance that the insurance companies buy. What is happening is we are getting that passed to us with rates on our homeowners and auto and commercial business. So my prediction in the next couple of years, you’re going to see rates rise. It’s going to be harder to get insurance with different companies because they’re not going to want to write much business.
Another thing that is driving insurance rates in the last ten years, there has been 89 occurrences like floods, wildfires, tornadoes, different things like that in the United States that were over $1,000,000,000 per occurrence. Last year there were 17 occurrences with $1,000,000,000 or more.
With the hurricane in Florida, they’re believing that it’s going to cost about $165 billion for that occurrence, and that’s going to be the largest hurricane payout ever. So that’s another reason why you’re seeing your insurance rates rise. And it’s just not one company. Everybody’s raising rates.
If you have any questions about your insurance, give me a call.
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