CLIMATE CHANGE
The Insurance Climate May Be
Changing With The Weather
T
he times, as the song goes,
are “a changin’.” So is the
weather. Like it or not,
climate change is a reality.
In many areas, especially in
Minnesota, the types of weather events
that people have come to expect, and
the types of preparation that they do
for those weather events, are no longer
a given. Many farms, in fact, have had
a tough few years dealing with their
crops. Businesses and homeowners have
encountered additional risks as well that
they never knew they needed to account
for. Right along with climate change, it
seems, is a change in the way insurance
costs and claims are being dealt with.
Consider the fact that hailstorms
and flooding are becoming more and
more commonplace. Do you have flood
insurance? Are you relying on the idea
that the area you are in has (historically)
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not seen much flooding? Is that idea
really a given at this point? The reality is
flooding is becoming more common in
many areas where it has not been seen
previously. Flooding is one issue that
requires its own policy in most cases.
What that means for the policyholder,
unfortunately, is that if they don’t have
flood insurance, they could be left
without a way to pay for repairs or recoup
losses in the event of a flood.
To put it further in perspective, when
risks increase, so do insurance rates and
claims. If a piece of property (or a vehicle)
you own is suddenly at risk of something
that it simply didn’t face before, rates are
inevitably going to go up. If hail becomes
more common, more vehicles will be
damaged, more claims will be filed,
and more costs will be incurred by the
insurance companies. Those costs will
drive up the cost of premiums. The cycle
continues.
So what can you do? Well, prepare for
unexpected weather. Flooding and hail
are two things becoming more common,
so take some precautions against them
in advance. In terms of mitigating risk
in other ways, speak with an insurance
professional about what those changes
could mean for you. Can you afford for
rates to go up? Can you afford to stay in
the dark about what is changing in your
area and your particular situation when
it comes to the weather?
For more information or to find out
how climate change could affect
your insurance, you can reach us at
nesbitagencies.com or call 952-746-
4312. Our staff of professionals has been
dealing with this for years, and we are
ready to help you deal with it as well. +