Auto and home insurance rates in the US lagged behind the inflation rate in 2020 and 2021, laying the groundwork for the premium increases which occurred last year and will continue into 2023, according to the Insurance Information Institute (Triple-I).
In its latest Issues Brief, Triple-I analysts stated that if premium rates did not reflect the rising costs of material and labour – which also increase the costs to repair and replace damaged homes and vehicles – insurers would quickly exhaust the funds they set aside (policyholder surplus) to ensure that they can afford to keep their promises to pay all claims.
