Photo: Gann, Brian (uploader)
Premiums for home and auto insurance in Texas are rising at twice the national rate - some want to blame extreme weather events due to climate change for the increase. How inconvenient!
Rich Johnson, Communications Director for The Insurance Council of Texas, says weather has always been part of insurance pricing in Texas and that weather has always been a factor. There are a number of other things at work in this scenario.
For auto insurance premiums - in the post-COVID world, more people are driving and they have some new bad habits that are increasing the intensity and frequency of accidents. They are more distracted - not just by phones, but by screens in their vehicles too. They are driving a lot faster. There are more accidents, Accidents that are occurring are more severe. Inflation has driven up the costs of repairs - inflation on both labor costs and on parts. Uninsured motorists are a source of increasing costs for drivers too.
On home insurance - Johnson says that, again, inflation is behind the increases in insurance premiums. Costs to repair homes have gone up - both labor and materials are dramatically higher.
Tim Zawacki, principal insurance analyst with S&P Global Market Intelligence adds that Texas reviews and adjusts rates more promptly than some other states - which may account for a portion of the reason behind Texas' rate rising faster.
For more information on insurance in Texas - see below...
Newsroom - Insurance Council of Texas
How are your auto and homeowners insurance costs calculated? (texas.gov)