Personal auto insurance carriers raised their rates by an average 2.5% nationwide last year, while home insurers increased prices by roughly 5.1%, according to figures from insurance consultant Perr & Knight’s RateWatch report.
While the rate increases reflect a general trend towards moderately higher prices in the two markets, five states led the others—in some cases, by double digits.
Top 5 states for homeowners rate increases
1. Oklahoma—12.1%
2. Florida—11.0%
3. Kentucky—10.9%
4. Kansas—10.3%
5. North Carolina—10.1%
In an interview with
Insurance Business, Nichelle Dawkins, director of strategic data for Perr & Knight, attributed the double-digit increases in Midwestern states to last year’s wildly active tornado season.
“As you recall, Oklahoma had a tornado that affected huge portions of the state and the next week, there was a tornado in Oklahoma City,” Dawkins said. “It’s been a challenging environment for homeowners carriers to operate in just because [Oklahoma] is known for being a cat-prone state.”
Not all states experienced such high increases, however. In California and Hawaii, homeowners actually saw some relief. California policyholders experienced a 3.4% decrease in homeowners insurance in 2013, while Hawaiians saw rates go down 0.7%.
Dawkins attributed California’s decrease to the tightly regulated insurance environment, though stressed that it is “too early” to make definitive statements about the downward trend.
Top 5 states for auto rate increases
1. Michigan—8.6%
2. Georgia—5.2%
3. New York—4.3%
3. Delaware—4.3%
5. Nevada—4.1%
Drivers behind Michigan’s rate increases were seen more in liability policies than physical damages, Dawkins noted.
“Michigan’s overall rate increases were driven by liability coverage,” she said.
Perr & Knight has been evaluating rate fluctuation in all 50 states since 2011. Following the release of these numbers, Dawkins said the firm plans on “providing analysis” for their carrier clients.
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