Minnesota Insurance Brokers

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Minnesota Insurance Service Agency, Inc.
working to bring Minnesota Insurance consumers the best possible rates and service!

The Insurance industry in Minnesota is trying to adapt to changing conditions, some of which have been caused locally and some of which are due to national conditions.
We have seen amazing changes in several sectors. Homeowner coverage have probably been the line where consumers have seen the most change. In the spring and summer of 1998, and then again in the summer of 2000, huge storms caused catastrophic damage and huge losses to insurance companies in the state. These catastrophic losses were piled on top of a longer term problem -- most companies in the state had not raised HomeOwner premiums for several years. Losses had been (in hindsight) abnormally low, companies were lulled into competing on price, and normal rate increases were not implemented.
Both things happened. Several insurance companies quit writing insurance in the state. Almost all of the others raised rates dramatically. Consumers who were forced to locate new insurance carriers paid higher rates immediately. All of the others have experiences rate increases when their policies renewed. This has caused a great deal of pain.
9/11 has also affected the industry as a whole. The Federal government has mandated new terrorism insurance coverages. Because terrorism risk calculations were not built into policies, insurance companies have been forced to pass these increased coverage costs along to the insurance consumer.
And, although Minnesota is not close to New York, all companies are members of reinsurance pools. If an unforseen catastrophic loss occurs (like 9/11), companies are required to pay money into the these pools. Because of this, it is clear that insurance consumers in the United States have all been affected and are being assessed because of the catastrophe of 9/11.