Get your property insured but be prepared for a significant price.

Piles of damaged property along the side of the highway after hurricane Irma.

Get your property insured but be prepared for a significant price.

Some insurance companies are not even taking on any new clients.


If you think the price of food and fuel is high, you should check the insurance prices for properties. The rate of increase ranges from 15% and up. There are some cases I am aware of whereby the rate increased by 35%.  Apparently, the reinsurance costs have increased, and the reinsurance companies have also reduced their capacity to the Caribbean Region and Florida. Due to the impact of the Hurricanes, some of the reinsurance companies are leaving the Caribbean and Florida. As a result, some of the insurance companies are not even taking on any new clients.

What is reinsurance?

According to the Wikipedia,  “Reinsurance is insurance that an insurance company purchases from another insurance company to insulate itself (at least in part) from the risk of a major claims event.[1] With reinsurance, the company passes on (“cedes”) some part of its own insurance liabilities to the other insurance company. The company that purchases the reinsurance policy is called a “ceding company” or “cedent” or “cedant” under most arrangements. The company issuing the reinsurance policy is referred to as the “reinsurer”. In the classic case, reinsurance allows insurance companies to remain solvent after major claims events, such as major disasters like hurricanes and wildfires.”

Get insurance.

Due to the high increase in rates, it may be very tempting for you to discontinue your insurance. However, getting insurance is the risk that you are paying for in the event something happens. What if something happens and you do not have any insurance, you may have to start all over again. In fact, you may not be able to start over again if you don’t have any money. The best thing to do is to get insurance just in case something happens.

The hurricane season starts on June 1st, and we do not know what the season will be like, so it is best to be prepared in the form of insurance. Furthermore, some of you have mortgages and the financial institutions will require you to have insurance to protect the money that they lend you.

The insurance companies and the financial institutions will work with you in that you can have a repayment plan with them over a couple of months. Don’t get deterred by the insurance rates, this will not last forever. One day, the rates will get lower than what they are now.


You should consider reviewing your deductible rates.  The deductible is the amount that you must pay or incur before the insurance company takes over the payments. The lower your deductible, the higher your premium. For example, if your deductible is 2%, your premium will be higher, however, the good news is that with a lower deductible, it means that you must pay out less. If your deductible is 10%, your premium will be lower than a 2% deductible, but you must pay out more of your personal funds before the insurance takes over.

Value your property correctly

When you insure your property, make sure that you get a valuation done so that you value your property correctly with the insurance company. This was a hard learning lesson for me. I valued one of my properties at the cost of the construction of my property. However, when our property got damaged by a hurricane, and I filed a claim, my wife and I were penalized due to the undervaluation of the property. The adjustors said that we undervalued the property by more than $300,000. As a result, the reimbursement of my claim was reduced.

I know this is one way you can reduce your premium if you provide the insurance company with a lower value. However, what if something happens to your property, you will be penalized and get a lower amount of funds from your claim.


This article is not to blame the insurance companies but to bring awareness to you about what is happening in the insurance industry currently and to encourage you to get insurance. Some people have opted out of insurance and have created a special savings fund monthly if something happens to their property. Obviously if you have been saving for years, please continue to do so and you may not need any insurance after all. Unfortunately, some people are not able to save, and furthermore, you need to be saving for many years if you intend to have money to rebuild your property if it gets destroyed. I personally think the safest thing to do right now is to get insurance. Mind you, there are some people who took the risk and did not get insurance, and nothing has happened to their property. However, that is very risky.

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