A recent survey by the Consumer Federation of America shows that homeowner’s insurance costs have risen 4 percent in 2000, 7 percent in 2001, and a further 13 percent in 2002. The 2002 upturn was much more severe in some states: 33 percent in Iowa, for example, and 57 percent in Texas.
The insurance companies blame catastrophes, mold from water damage, a drop in investment income, and the higher costs of reinsurance for the premium increases. As high as those premiums might be, though, you still need this coverage, in case of major damage to your home (and to protect you from liability claims).
To keep from losing your homeowner’s insurance coverage, limit the number of inquiries about coverage unless they are crucial. Questions about damage to your home may inadvertently result in a claim. Insurance experts say submitting a claim for less than $1,000 is often not worth the trouble, especially if it ends up causing you to lose coverage.
