Auto ins

I have mentioned in the past the dilemma facing the car insurance companies. They are competing on a price basis, each company claiming to save you money by switching. It is well known that the first year cost of installing a policy pretty much use up the first years premium so there is no profit for the company. This is particularly acute for companies that have agents, companies like State Farm and All State since they must pay the agents a commission, a cost not born by companies that have no agents. Because of their advertising they now have people switching every year. Since they cannot raise their premiums and stay competitive they have resorted to other means to save money. Their hands are tied with their auto line because of state laws but they have flexibility in the home owners and since these companies offer both types of insurance they are able to make up loses in the auto side with changes in the HO side. You will likely be receiving notices from your home owners company that they are reducing benefits in the most common claims areas like roof and hail damage. They will tell you that the roof will be adjusted for age and that siding deductibles will be a percentage of your coverage A on the dwelling. I predict that some companies will not be able to keep up with the stiff competition. We shall see.