Utah homeowners face double-digit increase in homeowner's insurance rates

by Cristina Flores, KUTV

Mon, July 1, 2024 at 10:24 PM Updated Tue, July 2, 2024 at 4:14 PM

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Utah homeowners have seen their home insurance rates increase by about 20%, ranking third in the country behind Texas and Arizona, according to a study by S&P. (Photo: KUTV) 2 Comment Share
- topics:
- Utah
- Insurance rates
- Homeowners
- Pike
- Increases
- Wildfires
- Claims
- Policies
SALT LAKE CITY (KUTV) — Utah homeowners have seen their home insurance rates increase by about 20%, ranking third in the country behind Texas and Arizona, according to a study by S & P.

The surge is a concern for residents and state officials like Utah insurance commissioner Jon Pike.

Pike's office confirmed the rising rates, which started going up in 2021.

Data from the commissioner’s office shows yearly increases: 7 percent in 2021, 12 percent in 2022, 17 percent in 2023 and 19 percent in 2024.

Salt Lake resident Kristina Doing noticed her policy went up about 20 percent.

"What has changed that suddenly there has been this big jump?" she asked, noting that nothing around her property has changed, nor have there been any disasters in her neighborhood.

Historically, Utah’s insurance rates have been competitive, often on the lower side compared to other states — now, rates in Utah are catching up to rates in other states, Pike said.

However, higher-than-expected claims and losses nationwide have contributed to the recent hikes.

Expensive disasters in places like California where recent, massive wildfires have destroyed entire communities, have made an impact beyond that state.

Insurance companies are looking at future risk and liability, and adjusting premiums.

Pike said that Utah is right behind California when it comes to building in the Wildland Urban Interface (WUI) — the area where new housing developments encroach on wildlands which are more prone to wildfires, floods and other disasters.

“From 2011 to 2020, there were over 6,000 new homes in high-risk wildfire areas in Utah. In California, that number was 10,000. We were second to California. The third state was a distant third," Pike said.

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“Drone use in assessing and determining what a homeowner’s insurance rate is going to be is becoming more common,” Pike said.

He added that it is legal for insurers to use drones to check the condition of your roof, or whether there are flammable materials or too many trees near your house.

He said if your insurance company increases your rates and cites added risk or liability, ask your agent for any photos and then ask what you can do to mitigate the risks around your property in order to avoid paying more.

In high-risk zones, some insurance companies have started dropping coverage — a trend seen in states like California.

While Utah homeowners still have plenty of insurance companies to choose from, Pike said in some communities, including Washington, Summit and Wasatch counties, some insurers are no longer writing new policies. Some customers in high-risk areas have been dropped by insurers.

All this has led Pike to join the National Association of Insurance Commissioners in conducting a deep study on insurance rates, with results expected sometime in the fall.

At Doing’s house, she hoped the study will provide clarity on the reasons behind the rate hikes.

She said, “I would want to know if these are necessary increases."

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