Insurance Industry experts, from both the brokerage and company side, would consider our current cycle to be in a “Hard Market”. Simply put, this means insurance companies are not experiencing adequate profit levels.
One of the main reasons for this Hard Market is that insurance companies are experiencing worsening loss ratios.
Recent stats suggest that, as an industry average, if a company is taking in $1 of premium, they are paying out $1.10 in claims. Losses associated with water/flooding, cyber breaches, storm severity and a more litigious society in Canada are becoming more of a headache for insurance companies.
The recent catastrophic losses that are being experienced all over Canada, North America and the Caribbean, have an effect on the hard market. Why would that matter, you might ask?
In reality insurance policies are comprised of layers of insurance coverage from North American companies and can contain further layers of re-insurance to make up the balance of coverage. Even a disaster such as Hurricane Dorian that hit the Bahama’s in November 2019 can create a displacement on the consumers in North America. Ultimately, this creates volatility in our market place and can cause frustration with consumers.
But what can you do in order navigate through the tough insurance landscape?
AUTO INSURANCE TIPS
Consider revising your coverage or deductibles.
- Increase your deductible to reduce your annual costs; something to consider if you have a strong driving record and are deemed less likely to experience an at-fault accident.
- Purchase an Accident Waiver. Protect against any premium increase related to an at-fault accident. It will increase your costs in the short term but will offer significant savings in the event you need to file a claim.
- Remove coverage you don’t want or need, such as glass coverage.
If your family has more than one insurance policy, you may be eligible for:
- Multi-Vehicle Discount. This can apply to all vehicles in your household, even if they are in different names.
- Multi-Product Discount. Talk to us and we’ll see if it’s possible to bundle your policies, such as those for your home, condo or rental.
- Recreational Vehicle Discount. If you’re insuring an RV or snow machine in addition to your car, you may be able to decrease your overall insurance costs.
- Practice safe driving. Strong advice on many levels; one being that convictions and license suspensions can increase premiums.
- Protect your vehicle. Theft or damage can increase your insurance costs. Park in a covered garage if possible, keep doors locked at all times, or install an alarm system if your vehicle does not have an immobilizer.
- Choose the right car. The make, model and year of your car influence your insurance costs, as some are safer than others or are stolen more frequently. Talk to us before you make a decision.
- Add new drivers to your policy. As soon as a driver becomes licensed, they begin building their driving history, which pays off down the road. The longer the insurance history – particularly when crash free – the less the driver will have to pay in the future. While this will cost more in the short term, it will benefit the new driver in the long run.
- Report the use of snow tires. In some regions, this may qualify you for a discount.
HOME INSURANCE TIPS
- Consent to a credit check. If you have a good credit score, you may be eligible for a reduction on your premium costs.
- Ask about product bundling. For example, you could be eligible for additional savings if you purchase both home and auto coverage
- Report updates to your home, such as a new roof or upgrades to home materials.
- Reassess the value of your belongings to ensure you have the appropriate amount of coverage.
- Provide the age and type of your hot water tank. For example, do you have a storage tank or are you tankless?
- Adopt a water leak detection system so you’re notified immediately when water enters your home.
- Install a burglar and fire alarm.
- Provide the date you moved into your home.
- Increase your deductible. If you can manage a higher deductible, you will lower the cost of your annual premium.
- Reduce your claim history by not filing claims for lower-cost fixes and replacements.
- Review your coverage options. We can walk you through insurance coverage types and help you determine which makes most sense for your needs and your budget.
BUSINESS INSURANCE TIPS
With proper representation, patience and an understanding of insurance cycles, we have the tools, experience and market capability to keep your mind at ease during a hard market. We take a holistic and proactive approach to our customer’s insurance needs by providing options and advice.
- It is a great opportunity for thorough reviews of your insurance needs and how we can keep your business looking good in the eyes of an insurance company, now and into the future
- Risk management practices and loss mitigation are also at the forefront during a hard market. Insurance companies are much more likely to provide adequate coverage, at a reasonable price point, for businesses and individuals that are on the more proactive side.
- We not only look at the risks that your business faces now, we extrapolate what risks may present themselves over time, leading to a more prepared and focused insurance policy and risk management plan.