Home Insurance Rate Hike Of 15% In Kansas
Kansas Insurance Department are receiving requests for home rate increase from insurers for 15%. Kansas has experienced record losses due to storm in the past 2 years and this is forcing insurance companies to request for a rate increase. It should be noted that rate increase for anything less than 12 percent is approved automatically.
Kansas residents filed over 137,000 insurance claims worth over $600 million in 2009 of which the majority of the claims are for property damage. This was in addition to more than 130,000 claims in 2008 worth around $595 million. This is forcing the insurance companies to hike the rates.
To avoid rate increases some insurance companies have started changing the insurance cover. Instead of insuring the replacement cost of the home they are insuring only the market value of the home. This makes business sense for them in case of a disaster. The perspective from the people is that home insurance rate hikes will force some people to drop the insurance policies which will be even more devastating as it would leave them with no insurance cover in case a storm strikes.
Whatever the reason for the rate increase, this is going to put burden on the people at this tough economic times. Once the insurance companies start increasing the rates, it is highly unlikely they will reduce it in future.