Property Values and Inflation Impacts on Insurance Premiums
The pains of inflation are being felt in every aspect of life from gasoline to groceries to insurance policies. In times like these, the best thing you can do to protect your assets is to ensure your property is accurately appraised and fully insured. Understand property values and inflation impacts on insurance premiums in this informative discussion with our experts at Morris & Garritano.
The Rising Costs of Goods
According to the US Bureau of Labor Statistics, the Consumer Price Index (CPI) shows a 12-month increase of 9.1% in the cost of consumer goods as of June 2022. The pains of inflation are being felt in every aspect of life from gasoline to groceries to insurance policies. In times like these, the best thing you can do to protect your assets is to ensure your property is accurately appraised and fully insured.
Inflation today is influenced by a number of factors such as supply chain issues caused in part by the COVID-19 pandemic and skilled labor shortages. The unprecedented frequency and severity of catastrophic losses fueled by climate change have exacerbated these problems, causing a rise in expenses across industries.
Additionally, according to research by the US Bureau of Labor Statistics, the cost of construction has increased 28% over the last five years. In 2021 alone, total nonresidential reconstruction costs increased 16.5%, led by a 51% increase in structural steel, and a 22.7% increase in the cost of lumber.