Month: June 2022

Maine Insurance Rates – Home and Auto Update

Posted on by Bob O'Brien

Maine insurance rates are some of the lowest in the US. But home and auto rates are up as insurers struggle with rising claim costs and rising construction values. Fortunately, Maine insurance buyers are seeing smaller rate increases than much of the country.

Maine Auto Insurance Rates

As of June 2022, Maine auto insurance rates are averaging a 1.7% increase at renewal. That’s considerably less than the national average of 4.3%. The Wall Street Journal recently reported increases as high as 20%.

The main factors driving auto insurance increases include:

  • More driving. Miles driven are returning to near pre-pandemic levels
  • More serious crashes. Traffic fatalities reached a 16-year high last year.
  • Higher repair costs. Parts and labor costs have both risen sharply due to staffing issues, shipping problems and supply chain glitches.
  • Higher used car prices. When insurance companies total a vehicle, they have to pay the current used car market price. Used car prices went through the roof recently.
  • Car rental issues. Auto body repair times are much longer. That means longer replacement rentals. Daily car rental costs have spiked, too.
Maine auto insurance rates are up 1.7% at renewal as of June 2022.

Maine Home Insurance Rates

Maine home insurance rates are rising faster than auto premiums, at a 4.1% clip. That’s still less than the 6% national average. And at an average premium of $1005 per year, Maine home insurance is a relative bargain.

Home insurance costs are affected by building values and claim costs.

  • Rebuilding costs. Building materials and labor costs spiked during the pandemic. Insurance companies have increased their “inflation guard” factors to provide increased coverage on renewals.
  • Longer repair times. Contractors are hard to find, too, which increases additional living expenses.
  • Unusual weather. Natural disasters caused $116 Billion in insured claims in 2021. Maine sees far less than the rest of the US. That’s one reason why our rates are lower. But insurers are feeling less certain about predicting future losses.
Maine home insurance rates average a 4.1% increase in June 2022

Individual Home and Auto Insurance Rates Vary

Every insurance company files their rating plan with the Maine Bureau of Insurance. That plan includes individual rating factors such as driving record, insurance claim history, property location and personal insurance scores.

Maine Insurance Rates – Find the Best Value

If you live in southern Maine, you can get up to 5 insurance quotes in 10 minutes from our website. Or contact a Noyes Hall & Allen agent in South Portland at 207-799-5541 for a free no-obligation custom review. We offer a choice of several insurance companies. That means we can help you find the best insurance value.

We’re independent and committed to you.

Market Value and Building Cost – How Much Insurance do You Need?

Posted on by Bob O'Brien

Market value and building cost are important factors for property owners. But only one really matters when buying insurance. Knowing which one can help you avoid buying too much – or too little – insurance.

Market value and building cost are both important to property owners. But only one matters for insurance.

Market Value and Building Costs – Both are High

Market values of real estate are at an all-time high. That’s no secret to anyone buying or selling property. Whether you believe we’re in a bubble or not, 2022 is clearly a seller’s market. Due to low supply and high demand, buyers are offering above asking price and making other concessions to get properties.

Building costs are also high in 2022. Although lumber prices are lower after a huge COVID spike, they remain at a historically high level. So do contractors’ labor rates. Prices for petroleum-based building materials are also sky high.

Market Value – What is It?

Simply put, real estate market value is the going price. The one a willing buyer and seller agree upon. Many factors go into market price. Among them:

  • Location (location, location)
  • Inventory of similar properties for sale
  • Features of the buildings
  • Acreage
  • Landscaping and other improvements

Building Cost vs. Reconstruction Cost

Building cost is different from market value. It’s also different from reconstruction cost.

Building cost includes:

  • Building materials (“sticks and bricks”)
  • Design or architectural work
  • Contractor labor and use of equipment

Reconstruction cost per square foot is often higher than building new. Some reasons for that include:

  • Constraints of working around existing landscaping and structures
  • Matching existing materials, design, etc.
  • Reduced economies of scale. Contractors often build several new homes at a time. This distributes the cost of equipment, materials and labor. A reconstruction job at one home doesn’t permit this kind of scale.

Insurance Doesn’t Cover Market Value

Market value includes land, earth moving, landscaping and hardscape. Insurance doesn’t pay for any of those things. Market value also includes outbuildings, fences, pools and other structures. Insurance lists those separately from main buildings.

Insurance Covers Reconstruction Cost

Insurance covers the cost to rebuild. Even after a complete disaster, a contractor may be able to use the excavation or foundation that remains. That’s why in highly desirable areas, insurance values are often less than the price you would pay to buy the property.

Can A Lender Make You Insure the Purchase Price?

Lenders are always concerned about protecting their interest in your property. But your building insurance amount may not match your loan amount. That’s OK.

By law, lenders cannot require insurance in excess of rebuilding costs for 1-4 family dwellings in Maine. If your insurance agent can prove that your policy covers 100% of reconstruction costs, your lender cannot require more insurance.

Your Insurance Agent – Your Advocate

An insurance agent should work with you to estimate the proper rebuilding cost of your property. They should also provide proof of insurance to your lender. Finally, they should advocate on your behalf if the lender pushes for insurance above the fair rebuilding cost.

Do you need to insure property in Southern Maine? Whether it’s in Greater Portland, Cape Elizabeth, Scarborough or anywhere in Cumberland, Androscoggin, Sagadahoc or York County, contact Noyes Hall & Allen Insurance in South Portland or call 207-799-5541.

We offer a choice of many insurance companies so we can help you find the best value. We’re independent and committed to you.

South Portland Home Insurance About to Renew?

Posted on by Bob O'Brien

We know South Portland home insurance. We can help you get the best value.

South Portland Maine home insurance since 1933 - Noyes Hall & Allen

From Ferry Village to Highland Avenue and Brick Hill to Meeting House Hill, Noyes Hall & Allen Insurance has provided South Portland home insurance since 1933. That’s a long time of protecting our neighbors and businesses.

Is your home insurance about to renew? Wonder if the price and coverage are competitive? Why not get a 2nd opinion? It’s totally free and without obligation.

Independent

As a Trusted Choice Independent Agency, we offer a choice of Maine’s preferred home insurance companies. That allows us to find solutions that fit your budget and your needs.

Committed to You

We’re a locally owned business. Our team lives, works and plays here. We support South Portland organizations and non-profits. Put our local knowledge to work for you. You can get up to 5 home insurance quotes in 10 minutes here, or by clicking the button below.