Summer is officially behind us, and fall awaits. Strange as it may seem, the change in the seasons does impact insurance claim categories and their respective frequencies. Getting a better understanding of the possible risks and trends could prove useful as you seek to assure yourself better security and coverage.
As you would expect, Covid-19 remains one of the primary factors impacting the insurance industry. Apart from this, the falling leaves and drops in the temperatures also present specific risk factors. Here’s more.
Let’s look at the specific considerations for insurance currently.
Covid-19 and its Impact
The United States is badly affected by Covid-19 with 43,404,877 infections reported since the outbreak of the pandemic in early 2020. Most believe that the disruptions due to the Covid-19 pandemic will continue through Fall 2021 in one way or the other. With the continual rise in the cases, it will become necessary for businesses to continue to make some allowances.
For instance, many employees are still working from their homes. This may mean fewer vehicles on the road and reduced chances of on-road accidents. Some believe that the rate of claims around accidents and auto industries may tend to remain low during the season. This could impact motor vehicle insurance premium rates. Some estimates are that up to 30% of US residents could not make their housing payments in June 2021. This could be due to the shutdown of their businesses or the loss of jobs. There’s an emerging risk that seems to span the housing market across renters as well commercial buildings. The impact can be significant on the housing insurance side of the business if this kicks off. A downtrend in the sector could hit insurance premium rates in unexpected ways. As always, the stuff that hits the headlines hits insurance too eventually.
By some estimates, around one-fourth of all auto theft claims come up during the fourth quarter of the year. Some studies have down that one of the primary reasons is that cars are loaded with gifts and other expensive items at this time. These may be tempting to the thieves. This pattern persists across several years and it may continue for Fall 2021 too. This may mean more claims on these counts.
There’s a continuous tussle between the legitimate needs for development and the ecological impact on the natural habitats of animals. During fall, as drier times set in water and food sources dry up (literally as well as figuratively) and this causes more movement of animals, such as deer and moose to populated areas. Other animals like foxes, raccoons, and coyotes may also follow suit.
With more critters out there, the greater is the probability of hitting one of these animals. Fall tends to see more such incidents over the years and the trend will likely continue for 2021. Texas, California, Missouri, Minnesota, and Pennsylvania are the top five states witnessing the highest number of wildlife-related accidents from October-December. So, if you’re living in these states, keep your eyes out.
According to the National Oceanic and Atmospheric Administration (NOTA), 15 to 21 named storms will develop during Fall 2021. The number includes tropical storms with wind speeds of 39 mph or more. Out of these, 3 to 5 storms will be major and can have a wind speed of 111 mph or even higher.
The trend has been similar for the past six years and obviously the extremely active hurricane season has an impact on the insurance industry too. Home insurance claims are the top claim category during the season and that could remain so this year. It will be essential to re-check your home and auto insurance policies. Insurers do also come up with deals and offers in these two claim categories to capture higher market share in response to immediate needs.
The frequency of on-road collisions also increases during the Fall due to slippery roads. Many times, drivers get caught off guard as conditions change on them, leading to accidents. This is the time of the year when road conditions worsen due to fallen leaves, snow, and ice. California, Texas, and Florida are the top three states with the highest number of rear-end collisions. Washington and Arizona closely follow. So, keep your eyes on the road and your hand upon the wheel.
Of course, for everyone, it is essential to validate your auto insurance and medical insurance policies as the chances of accidents rise in the season.
Fire and Smoke
The reason behind fire and smoke at home also changes from one season to the other. During the summers, most of these incidents are grill-related. During the fall, the root cause shifts to fireplaces and woodstoves. Such accidents can cause fatalities, injuries, and significant property damages, and loss of valuables.
Obviously, homeowners need to take preventive measures, such as the proper inspection of chimneys and fire alarms, rechecking electrical appliances and outlets, etc. Just as importantly, it is also necessary to check on insurance policies and ensure they cover claims for damages due to such incidents.
To Sum it Up
Seasonal factors always have an impact on the insurance industry. It seems fair to assume that Fall 2021 will follow the trends seen in the past several years, such as an increase in wildlife-related accidents, rear-end collisions, fire and smoke incidents, and likewise. Covid-19 is also an important factor contributing to the change in the insurance claims’ trends and patterns. Now that you know what could go wrong, do check if you are protected from these adverse events as the season turns.