It’s the start of a new year, and it's natural to feel a mix of excitement and uncertainty about what 2025 holds. At Chalmers Insurance, we share your anticipation and are committed to helping you navigate the evolving insurance landscape with confidence. Here's what you need to know and how you can prepare.
Emerging Market Trends in 2025
Understanding the Market Landscape
The insurance market outlook in 2025 is full of uncertainty and cautious underwriting. With unpredictable inflation and rising capital costs, carriers are becoming more selective and writing fewer policies overall. This trend is especially noticeable in property insurance, where underwriters are taking a closer look at the condition, value, and history of properties. They are scrutinizing loss histories, safety records, and financial stability more closely than ever before.
Impact on Property Insurance
For property owners in Maine and New Hampshire, maintaining your home is more crucial than ever. Inspections are increasingly common, with many carriers utilizing drones and other technologies to evaluate roofs and identify potential hazards such as overhanging branches or aging roofs in poor condition. These issues could lead to non-renewal or ineligibility for coverage. To prevent water damage, consider installing water detection and shut-off devices.
Personal Insurance: What to Expect
Home, Renters, and Condo Insurance
In 2025, rate increases for personal insurance policies are expected to be more moderate compared to last year. However, rising costs of building materials and labor, along with extreme weather events, are still driving increases. Properties in high-risk areas, such as coastal regions of Maine and New Hampshire, may see higher rates due to increased weather-related claims.
Personal Car Insurance
While the rate increases may not be as steep as last year, policyholders should still expect some rise in premiums. Similar to property insurance, the rising costs of goods and services make car accidents and collisions more expensive to cover. Supply chain issues have led to higher costs for auto repairs and replacements, resulting in increased auto insurance rates and premiums. Increased frequency and severity of claims costs, riskier driving behavior, and cost increases for medical and hospital services are also pressuring the insurance industry with increased losses, all key drivers in the rise of auto insurance premiums.
Business Insurance: Key Changes
Commercial Insurance
Businesses in Maine and New Hampshire can expect a 10 - 15% rate increase on average, though those with a clean insurance history may see smaller increases. Property insurance premiums are on the rise due to several contributing factors. Inflation pressures are driving up the cost of goods and services; the rising costs of building materials and labor are leading to higher replacement costs for buildings. Businesses with buildings or structures can expect increases in their property premiums due to these higher replacement costs. Satisfactory claims history, proper maintenance and condition, and loss mitigation practices such as installing low temperature and water detection/shut-off devices can help contain premium costs.
Workers' Compensation
Workers' compensation rates are expected to increase by an average of 7% in 2025. However, rates may vary by class code, so some businesses could see different changes. To help manage these costs, businesses can implement safety measures and training programs to reduce the risk of workplace injuries.
General Liability and Commercial Auto
General liability rates are expected to vary, with some carriers increasing rates while others remain stable. Businesses expecting sales growth should update their policies promptly to avoid large audit premiums. Public liability risks related to slips, trips, and falls are increasing. To mitigate the potential for such claims and help control premium costs, it is essential to maintain proper upkeep and conduct periodic, documented inspections of parking lots, walkways, and stairs.
The rise in both the frequency and severity of commercial automobile claims has led to increased premiums for most business owners. The cost of auto repairs, medical care, and hospitalization, along with litigation and court rulings, contribute to the overall expense of each claim. Implementing sound risk management strategies, such as enhancing driver performance and conducting regular safety training, can help reduce the frequency and severity of accidents, ultimately lowering premiums.
Is Remarketing Your Policy a Good Option?
Considering the expected rate increases, you might wonder if it's time to shop around for better rates. While remarketing can offer some savings, increased property inspections may make it challenging to secure new policies. Staying with your current carrier might provide discounts or bonuses not available elsewhere. At Chalmers Insurance, we work with a range of reputable carriers to find the best options for our clients. Our agents can guide you on whether remarketing is the right choice for you.
Tips for Saving Money in 2025
We understand that rising insurance costs can be a concern. At Chalmers Insurance, we're dedicated to helping you find the right policy for your budget without compromising on coverage.
Contact us today to schedule an appointment with one of our experienced agents. Let's work together to ensure you have the right coverage for your needs and peace of mind for the year ahead.
