The 2015 Home Insurance is an annual publication of the Mass. Division of Insurance
The latest annual issue of the Massachusetts Division of Insurance’s Home Insurance Report for 2015 was published much later than expected this year. With that said, instead of skipping this year’s report, Agency Checklists thought our readers would still be interested in how the Massachusetts homeowner’s insurance market currently fares, particularly as it appears to be on the cusp of great changes. Don’t believe us? Then take a look at these three recent articles from Agency Checklists in just the past month alone:
- A Q&A With Bill Martin of Bunker Hill: Big Data And Quoting Convenience Are Key To Bunker Hill’s Massachusetts Plans
- New Insurtech Homeowner Carrier, Swyfft, Quotes In Seconds For Independent Agents And Writes Coastal and Urban Risks
- Heritage Insurance to Buy Narragansett Bay In $250 Million Dollar Deal
Since 1996, the DOI has been required to produce a home insurance report pursuant to M.G.L. c. 175 Sec. 4A & 4B. Unlike private passenger auto insurance in Massachusetts, there are no laws requiring that a property owner have home insurance. Notwithstanding that fact, however, homeowner’s insurance continues to be the second largest line of property and casualty coverage in the Commonwealth (after private passenger auto insurance).
For those interested in how the Division compiles the report, it uses aggregate 2013, 2014, and 2015 data from both insurers and their statistical agents in the Massachusetts homeowner’s marketplace. All of the data collected is then sorted by Massachusetts zip codes and Insurance Services Office, Inc. (“ISO”) territories in order to produce the report. The Division cautions in the report though,
It is important to note that while some of the results in this report apply to all home insurance policies in the Commonwealth, other results apply to policies written by only the 25 largest Massachusetts home insurance companies, FAIR Plan and/or only to particular zip codes in the Commonwealth.
Trends from this year’s report
This year’s report cites a 1.3% increase in the total number of home insurance policies between the years 2014 and 2015. While representing the second increase in a row for this marketplace, it is lower than the previous year which saw the number of policies rise by 2.1% from between 2013 and 2014.
According to the DOI, as of 2015, there were 1,926,172 home insurance policies in force in the Commonwealth. In Massachusetts, the home insurance market covers non-commercial property, which includes risks of damage to structural and personal property, as well as for risks involving personal property claims. In comparison, in 2013 there were a total of 1,863,049 policies while the number was 1,901,864 in 2014.
The Make-up of the Massachusetts Home Insurance Marketplace
As for the make-up of the home insurance market in Massachusetts, it is composed of three major types of home insurance: condominium, traditional homeowners and rental insurance. The three types of home insurance are offer by 72 licensed insurance companies offering home insurance products here. These licensed insurers do not represent the total number of insurers licensed in the Commonwealth, rather only those who have written ten or more HO-3 or similar type policies in a Massachusetts county between July 1st – December 31st, 2015.
As of 2015, these licensed carriers collected approximately $2.2 billion in written premium for home insurance policies in Massachusetts. As evidenced by the following graph, each of the three major types of traditional home insurance saw an increase in the total amount of policies written as compared to 2014. In 2015, there were 224,242 condominium policies in force, 1,452,671 traditional homeowner’s policies in force, and 249,259 tenant or rental insurance policies in force.
The following graph charts the three-year trend in the total policies by type of coverage for each of these three types of home insurance.
More to come on the Annual Home Insurance Report in the coming weeks
With so much information packed into this annual report, similar to previous reports, Agency Checklists has decided to break the report up into a four-part series. The coming weeks will see further articles on the state of FAIR Plan, home insurance coverage by counties, the impact of auto insurance and flood insurance on this market as well as financial results from the report.