Insurance premiums for private and commercial properties are expected to go up by 15% or more (see related story). Nobody is to blame except perhaps the high number of worldwide calamites with extensive damage last year.
This news will certainly be felt as a blow to both residents and businesses already hit hard by inflation while still recovering from the unprecedented COVID-19 crisis. It is something one can’t easily save on either, for obvious reasons.
Adequate coverage is a requirement for mortgages but essential to protect assets too. Without it there is basically no security regarding the future in the event of a natural disaster.
Those able to, can try adjusting the content of policies to cheaper versions. However, that clearly entails the risk of these being worth less when needed.
The prudent approach would be sticking to at least the estimated value of insured possessions. As prices have risen across the board, that might not be enough to replace them anymore, but at least the pay-out won’t be even lower.
What should – if at all possible – be avoided is to give up and cancel the coverage altogether. While people may joke about their property being “insured by God” it is really no laughing matter.
Devastating Hurricane Irma caught many with their proverbial pants down for lacking insurance. Not only homeowners but in case they were landlords often also their tenants suffered as a result.
It’s a painful lesson to have to learn that way.
