Just about everyone has been talking about the changes coming in 2017 to their health insurance coverages and premiums, and there’s been a lot of movement in the flood and homeowners markets.
With so much to discuss, we recently caught up with Kyle Beerbohm of Aubert Insurance Agency to talk about the impact of health insurance on real estate transactions as well as to find out what other important changes are happening in the insurance world.
Impact of health insurance changes on real estate
Many people are facing the prospect of higher insurance premiums and deductibles on their family’s health insurance for 2017. And while the horror stories have gotten alot of press especially during the election, the reality is that many people have to figure out how to budget for higher insurance costs at least in the short term.
On the real estate side, this means taking extra care when pre-qualifying buyers to make sure they can afford their new home payment. We’ve been working more closely with our lenders and ultimately our buyers are now better educated and prepared for potential budget changes in 2017 related to health insurance.
Important Changes in Flood Insurance
According to Beerbohm, flood insurance is a “good news, bad news” scenario headed into 2017.
“Living in south Louisiana, flood insurance is a big deal, but with changes being made at the government level, rates are going up and people are becoming more aware of it,” says Beerbohm.
On the flip side, he’s finding more people buying flood insurance for the first time, even if they are in a preferred zone where flood insurance is not required. In these cases, the coverage is so affordable that homeowners are having a hard time passing it up.
“Not everyone’s rates are going up, but it is affecting a lot of people,” says Beerbohm. “It’s definitely become a larger part of the conversionation that people want to understand.”
Beerbohm encourages homeowners to check their flood rate renewals which could be in the 10-15% range this year. However, he notes that per federal guidelines, the maximum your premium can be increased in one year is 18%.
Expanding Homeowners Insurance Markets
2017 should be another good year for expansion of the homeowners insurance pools available in south Louisiana. Independent carriers are seeing an influx of new carriers aggressively writing new policies even below I-12.
At the state level, Beerbohm reports that things at the fair plan are stable and the increased competition is having a positive impact on rates.
Beerbohm did have 2 pieces of great advice going into next year.
The first piece of advice is to check the numbers on bundles with home and auto insurance to make sure they are in your best interest. “Bundles remain a great option for some homeowners, but I strongly recommend you also price price out each policy individually,” says Beerbohm.
The second piece of advice is to closely check the information on your insurance application for accuracy to make sure it's correct. Beerbohm said there are reports of people who made simple mistakes on their policies such as when their home was built and have had trouble getting claims honored due to inaccurate information.
This is a good reminder to do your homework, shop around and pay attention to the fine print on your insurance transactions just like with any other important transaction.
If you have any questions about the information in this article, please contact a member of our team to discuss how they may impact you. Also we’d like to thank Kyle Beerbohm at Aubert Insurance Agency for contributing to this post.