Shrinkflation - Less Protection & Higher Premiums!

As the price of gas and other essential products continue to rise, Florida residents have become too familiar with the effects of inflation. While inflation has impacted most Floridians, policyholders should become aware of another phenomenon that directly affects their pockets – shrinkflation.

The Phenomenon of Shrinkflation

Less Protection & Higher Premiums!

Shrinkflation is a process by which insurance companies increase their policy rates while simultaneously providing less insurance protection to consumers. While lawmakers continue to try to address the world of property insurance, insurers continue to implement strategic tactics to diminish coverages coupled with increases in premiums. For example, insurance companies have cut coverages and put caps on payments at arbitrary amounts relating to damage from water. Despite the cost of your policy, extent of your damage, or value of your home, a million-dollar policy may only provide $10,000 in water damage coverage.

Insurance companies have also sought to repair roofs at their actual cash value (what a roof may be worth after years of depreciation) rather than replacement cost value (what it costs to currently replace the roof). This has the effect of putting policyholders at risk of not being able to afford a roof over their heads. Policyholders are paying more money for a policy that fails to provide adequate coverage.

While high prices continue to affect all aspects of life, it is important for policyholders to become aware of the effects shrinkflation will have on their coverages. Having peace of mind regarding the protection for your home is paramount as the 2022 Hurricane Season approaches. If you have any questions regarding your home insurance policy, call Larry Moskowitz, PA.

To learn more about what the property damage law experts at Windy Law can do for you - call 844-849-0760 or email us at info@WindyLaw.com.
All consultations are free of charge: No recovery - No fee!