1 / 13

THE TRUE FACTS

THE TRUE FACTS. South Carolina Homeowners Insurance. SC Homeowners pay higher rates compared to neighboring states. SC Insurance Premiums among the highest in the nation . SC rates average $156 (19%) more than GA and $248 (33%) more than NC.

ernst
Download Presentation

THE TRUE FACTS

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. THE TRUE FACTS South Carolina Homeowners Insurance

  2. SC Homeowners pay higher rates compared to neighboring states • SC Insurance Premiums among the highest in the nation. • SC rates average $156 (19%) more than GA and $248 (33%) more than NC. • SC premiums = top ten most expensive in the country. • Higher premium states are on the Gulf Coast/tornado alley/Great Plains where risk of loss is much greater. • TX LA, MS & AL all have a very high homeowner’s insurance rates due to extreme weather risk of both hurricane and tornado. • FL is exposed as a peninsula to hurricanes from both coasts. • These states are hardly comparable to SC.

  3. SC Homeowners pay higher rates compared to neighboring states

  4. SC Insurance companies make a higher return on Net Worth in SC • SC Insurers have experienced a 22% return of net worth in SC for the last ten years • Highest of any state in the country • Nearly four times the national average of 5.9% • In comparison to other states this return can only be considered excessive for SC homeowners. • Gulf Coast states that provide a negative return • All of this have a relatively higher risk than SC.

  5. SC Insurance companies make a higher return on Net Worth in SC

  6. Insurance Companies are avoiding risk and paying out fewer claims Insurance companies have increased deductibles, stopped covering flood, wind and hail, and otherwise shifted risk to federal, state and homeowners. In 1992, Hurricane Andrew cost insurers about 50% of their net worth. In 2005, Hurricane Katrina cost the insurers about 5% of their net worth. National insurers have now accumulated nearly $600 Billion (yes, billion) in claim reserves over a 43 year period. This exceeds the losses from the top ten catastrophic storms listed below by a ratio of nearly 400%. Homeowners have prepaid insurers to accumulate these reserves, which by any measure is excessive, while future premiums just keep going up. At this rate, one can only imagine the accumulation of wealth over the next 43 years. Source: The Insurance Industry’s Incredible Disappearing Weather Catastrophe Risk; www.consumerfed.org/pdfs/InsuranceRegulationHurricaneRiskhDisappeaaringCoverageStudy2-12.pdf

  7. Insurance Companies are avoiding risk and paying out fewer claims

  8. Insurance Companies are avoiding risk and paying out fewer claims The ten worst catastrophes total $161 billion over a 25 year period as listed below. The chance of all of these catastrophes occurring in the foreseeable future is relatively low, and if they did the reserves currently held by the insurance companies is more than sufficient, particularly given the lower level of coverage. Source: Insurance Services Office; Insurance Information Institute. http://www.iii.org/facts_statistics/catastrophes-us.html

  9. Insurance Companies are avoiding risk and paying out fewer claims 1. Hurricane Katrina, $45.5 billion August 2005 2. WTC, Pentagon terrorist attacks, $22.9 Sept 2001 3. Hurricane Andrew, August 1992 $22.4 4. California earthquake, Jan 1994 $17.3 5. Hurricane Ike, Sept 2008 $12.7 6. Hurricane Wilma, October 2005 $11.4 7. Hurricane Charley, August, 2204 $8.5 8. Hurricane Ivan, Sept 2004 $8.1 9. Hurricane Hugo, Sept 1989 $6.7 10. Hurricane Rita, Sept 2005 $6.2 Total $161.7 billion

  10. SC truly has a relatively low risk of a major hurricane The true facts are that for the period from 1851 to 2009 (159 years) there has been 4 major Category 3+ hurricanes in SC, and only 1 in Beaufort County. According to the National Hurricane Center, the likelihood of a major hurricane occurring in Beaufort County is once every 79 years, and a Category 5 hurricane is every 500 years. The two charts below, indicate that the frequency and severity of hurricanes in South Carolina are dramatically different than the models developed by the risk models utilized by insurers, which are unregulated by the states and are self-serving agencies funded by the insurance companies.

  11. SC truly has a relatively low risk of a major hurricane

  12. SC truly has a relatively low risk of a major hurricane

  13. The Cost of repair/rebuild has decreased over the last 5 years According to the NAHB Construction Cost Survey, the average price of construction fell 16% from 2009 to 2011. It is true that construction costs have increased from 1997, but they fluctuate down and up with housing cycles. The insurance industry only annotates the increases, and rarely acknowledge the decreases. Source: NAHB

More Related