Insurance Companies Hit Hard By Economic Crisis

The sub-prime mortgage crisis and rising unemployment have forced consumers to cut back on their expenses across the board, and that includes insurance coverage for homes and automobiles. Consumers are either dropping coverage or raising their deductibles in an effort to lower their premiums. Consider this: the number of uninsured motorists is expected to rise by nearly 3% from 2007 to 2010 The insurer Allstate saw a 4% drop in property liability insurance for fourth quarter 2008, and have experienced a 55% drop in their financial performance index (as seen from the graph). Market analysts can only further explain this turn of events with the idea that as a result of our current economic crisis, people are redefining what their discretionary income is.

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Consumer Woes Wallop Insurers