According to the Consumer Federation of America, homeowner's insurance premiums rose 7 percent in 2001 and over 13 percent last year--with increases topping 30 percent in Iowa, Florida, and Texas.

In addition to hiking premiums, insurers are imposing stricter underwriting standards, refusing to write new policies in certain states, rejecting claims, canceling policies, and minimizing coverage. The homeowner's insurance crisis can be attributed to investment losses, skyrocketing mold claims, higher property values and repair costs, and payouts that exceed premium collections.

To keep premiums under control and avoid losing coverage, homeowners should file only large claims; increase their deductibles; and perform all necessary home maintenance tasks. They also should think twice before calling their agent about potential claims and look over their Comprehensive Loss Underwriting Exchange (CLUE) report, which details all past claims and losses. Those unable to obtain coverage from a major carrier will be forced to pay higher premiums and deductibles to secure policies from the state's high-risk pool or surplus-lines carrier.

Source: Chattanooga Times Free Press (TN) (08/03/03); Martin, Ray