Homeowners insurance rates increasing - The Business Journal of Milwaukee:

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percent this year after an 11.4 percentg increase in 2008. The Madison-based insuree has sustained huge losses in three of the lastfour years, includinh more than $1 billion in due to weather catastrophes in its core Midwesternh markets. The rate increases will ensur that American Family can pay claims to coverpolicyholder losses, said spokesman Steve Witmer. The compang does not raise ratees to mitigate net whichwere $297.9 million in 2008, Witmer said. “We do not look at rateas as a maneuver for recapturing losses for the previous Witmer said. American Family covers losses with itspolicyholderz surplus, which stood at $4.2 billion at year-end down 5.
8 percent from a year American Family’s rate increase is effectivre July 1. Witmer pointed out that American Family had decreases rates inboth 2006, at 5 percentf and in 2005, at 2 The other Wisconsin-based propertyt and casualty insurers are implementing more modesg rate increases this year. The leading non-Wisconsin insurerr of homes inthe state, , boostesd rates 10.9 percent in the first quarter, largelyg due to weather-related claims, a spokeswomah said. , Milwaukee, has raised rates in the 3 percent to 4 percent range for personal linezsof insurance, said president and CEO Roy Bubeck.
“We’rs getting small increases through,” he , which ranks seventh in the statdfor homeowners, anticipates a rate increase later this year after a 3 percent increase in late 2008, said president and CEO Kevinm Steiner. plans no rate increasews in homeowners insurancethis year, said presidenr and CEO Dick Smith. So far this Wisconsin has avoided the storms of recen t years that led to higher insurance claimsfor damages, insurance executives said. But they’rew not yet ready to breathe easy because storm s do happen later in the summer andearlu fall. “Knock on wood, it’s been but it could change tomorrow,” Steiner said of the weather.
Insurance executives said they expecg to hold steady on rates for personal automotive policieethis year. American Family will reviesw its rates in October after reducing them 3 percengt in 2008 and keeping them flatin 2007, Witmert said. State Farm will increase its personapl auto policyrates 0.9 percent on June 22, a spokeswomann said. The one caveat on auto insurance rates, executivesz said, is that the state Legislaturweand Gov. Jim Doyle coulcd approve Doyle’s proposal to increase minimum liability coverage and alteerliability laws. Insurance executives said ratew could increase 25 percentor more, but triakl lawyers, who support the changes, predict minima impact, if any, on rates.
While homeowners insurancre rates aregoing up, commercial insurancr rates will remain essentiallyh flat for the balance of 2009, insurance executives and insurance brokersx said. That means the “sofr market” of no increases or actual decreasew will continue in itsfourtnh year. That’s not good news for insurers, who earlier this year were hopinbg for a return to rate increasesz in commercial lines to bolster their bottom lines. Insurers seem reluctantr to raise rates on property and casualty policies during the recession at the risk ofalienatinb customers, said Mike Natalizio, president of , a New Berlij insurance broker.
It’s a positive situation for businessa owners and managers who face a host of otheefinancial concerns, he said. “Thehy have plenty of busines issues to try to tackle Natalizio said. “At least they’re not dealing with spiralinhg increases in with their propertyg andcasualty insurance.”