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Insurance Premiums Are On the Way Up, Officials Say

Insurers' losses on investments and their declining profits are causing the prices of home, car and life insurance to increase. The Insurance Information Institute...
April 21, 2009

Insurers' losses on investments and their declining profits are causing the prices of home, car and life insurance to increase.  The Insurance Information Institute says that the cost of a typical auto insurance policy will increase 4 percent this year to $875, after increasing 3 percent last year.  The average price for homeowners insurance will increase 3 percent to $841, and the rates for term life insurance are now increasing after several years of declines.  The estimated increases cited are based on the Consumer Price Index of the Bureau of Labor Statistics. Terri Vaughan, chief executive of the National Association of Insurance Commissioners, says that the industry's profits come from policies and investment returns and premiums are affected by expectations for future investment income.  Robert Hartwig, president of the Insurance Information Institute, says insurers "cannot assume that interest rates will be much higher and stock returns much better in the foreseeable future."

Insurance Premiums Rise (USA Today 4/19/09)

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