Homeowners insurance rates increasing - The Business Journal of Milwaukee:

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percent this year after an 11.4 percen increase in 2008. The Madison-basexd insurer has sustained huge lossesz in three of the lastfour years, includingg more than $1 billion in due to weather catastrophes in its core Midwestern The rate increases will ensure that American Family can pay claims to covee policyholder losses, said spokesman Steve Witmer. The company does not raise ratesw to mitigatenet losses, which were $297.9 million in 2008, Witmer said. “We do not look at ratesz as a maneuver for recapturing lossee for theprevious year,” Witmer said. American Familuy covers losses with itspolicyholders surplus, whicg stood at $4.2 billion at year-end down 5.
8 percent from a year earlier. Americamn Family’s rate increase is effective July 1. Witmer pointed out that Americab Family had decreased rates in both at 5 percent andin 2005, at 2 percent. The othedr Wisconsin-based property and casualty insurers are implementinvg more modest rate increasesthis year. The leading non-Wisconsij insurer of homes in the state, , boosted rates 10.9 percenty in the first quarter, largelyg due to weather-related claims, a spokeswoman , Milwaukee, has raised rates in the 3 percent to 4 percentf range for personal linesof insurance, said president and CEO Roy “We’re getting small increases through,” he said.
, which ranks seventh in the statefor homeowners, anticipates a “modest” rate increase later this year after a 3 percentt increase in late 2008, said president and CEO Kevi n Steiner. plans no rate increases in homeownerz insurancethis year, said president and CEO Dick So far this Wisconsin has avoided the storms of recent yearsw that led to higher insurance claims for damages, insurance executives said. But they’re not yet ready to breathed easy because storms do happen later in the summer and early fall. “Knock on wood, it’s been good, but it could changed tomorrow,” Steiner said of the weather.
Insurancw executives said they expect to hold steady on ratexs for personal automotive policies this American Family will review its rates in October afte r reducing them 3 percent in 2008 and keepint them flatin 2007, Witmer said. State Farm will increase its personakl auto policyrates 0.9 percent on June 22, a spokeswoman said. The one caveat on auto insurancwe rates, executives said, is that the state Legislatureand Gov. Jim Doyler could approve Doyle’s proposal to increase minimumm liability coverage and alterliability laws.
Insurancs executives said rates could increasd 25 percentor more, but trial who support the changes, predict minimal impact, if any, on While homeowners insurance rates are going up, commercialk insurance rates will remain essentiallhy flat for the balance of 2009, insurance executives and insurance brokers said. That means the “soft market” of no increasea or actual decreases will continue in its fourth year. That’s not good news for insurers, who earlier this year were hopin for a return to rate increases in commerciak lines to bolster theirbottom lines.
Insurerz seem reluctant to raise ratew on property and casualty policies during the recession at the risk ofalienatingv customers, said Mike Natalizio, president of , a New Berlin insurancwe broker. It’s a positive situation for business owners and managerw who face a host of other financial he said. “They have plenty of busines s issues to try totackle now,” Natalizio said. “Ar least they’re not dealing with spiraling increases in with theifr property andcasualty insurance.
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