NEW ORLEANS — Homeowner's insurance rates across the U.S. are up significantly and in Coastal Louisiana, homeowners are opening new premium bills that may be the highest they've ever seen. So what is going on and what can you do to save money?
Like so many of us, Claudia Kelley had home damage from Hurricane Ida. The roof damage caused leaks which ruined her kitchen. Then came the sticker shock when she found out her homeowner's insurance was going up $1,100.
“It is going to be difficult because we are both retired and where you pull the money out you don't get that much on Social Security,” said Kelley of Avondale.
“I'm getting a lot of phone calls from people who are just saying, ‘Hey, I don't know what to do. This premium is making my mortgage unaffordable.’ And it's hard to hear that,’” said Frank Caminita, an agent at Rick Rogers TWFG Insurance Services.
Frank is Claudia’s agent and he and his colleagues say they are seeing the highest premium increases right now in their entire careers. They are anywhere from 30 to 100 percent.
Here's why:
The cost of reinsurance is up. That's what insurance companies buy from the big companies for catastrophic events. We've had our share: Hurricanes Laura, Delta, Zeta and Ida.
There are supply chain delays, and rebuilding costs are substantially higher.
“Lumber prices are up 300 percent approximately over the last 10 years. Labor is in high demand. Demand is high, material demand is high, price is high,” said Caminita.
Some things are out of your control but here's what you can do to lower your premium.
- If you have a new roof. Roofs after Hurricane Katrina no longer count as new.
- If you have a hip roof with four sides like a pyramid, rather than a two sided gable roof.
- If you have upgraded hurricane widows.
- If you have new HVAC, electrical or plumbing.
- Bundle your flood, home, and car insurance with the same agency.
- Increase your deductible.
- Have an agent get multiple quotes from different companies.
But that can't be done with so many homes still damaged from Hurricane Ida.
“You can not move to another insurance company if you have existing damage to your house,” explained Caminita.
Claudia had Frank update her policy showing her brand new roof after Ida. And not only did it lower her premium by $900, but she got $16,000 more in coverage.
“I was very elated when he called and told me the insurance dropped,” said Kelley.
And while that's helpful in the short term, insurance rates are not predicted to go down anytime soon for some long-term relief.
Insurance companies used to allow policies for only 80 percent of replacement costs, but now it must for100 percent.