— Get the Facts from Your Insurance Agent in Mississippi
Despite the online chatter and discussions you may have heard in the community, the latest results from the Mississippi Property Insurance Clarity Act Data Call have confirmed that insurers are not overcharging homeowners for their insurance in the state. Instead, these insurers are losing money in both inland and coastal regions. The analysis was performed and released in December 2015 by the Mississippi Insurance Department. Under the Clarity Act passed in 2015, insurers are required to obtain geographical comparisons and market analysis of homeowner insurance premiums and losses in the state.
Why the Study Was Done
The Clarity Act was originally created after residents in Mississippi stated that they were forced out of the private market and into the state-run wind pool of insurers because their rates were too high. In the summary of the MID report, it stated that there was no particular region in the state that was subsidizing another. In reality, homeowners’ insurance carriers had higher costs than the premiums they were charging.
The data was compiled comparing rate information and other pricing details from insurers between 2005 and 2014. This included areas such as:
- Direct incurred losses
- Direct earned premiums
- Policy limits
- Allocated loss adjustment expenses
- Number of policies in force by earned house years and zip code
The data was then reported in three categories: homeowners’ policies that included windstorm coverage, policies that excluded the windstorm coverage option and policies that were only with windstorm coverage.
The results concluded that insurers saw a rate of return over the past 10 years at -26.8 percent and for 25 years at -9.6 percent. This is below the national insurance industry average.
The entire purpose of this study was to help homeowners better understand their home insurance coverage and for insurance agents in Mississippi to better explain the costs to homeowners. The goal is to move homeowners away from the state pool and back to private insurers, especially now that homeowners can see they are not overpaying.
Meet with an Experienced Insurance Agent in Mississippi Regarding Your Home Insurance Policy
You can assess how much you are paying for homeowner’s insurance and whether or not you have adequate coverage by talking to a knowledgeable broker at The Nowell Agency.