Is Minneapolis Duplex Insurance Killing Your Cash Flow?

Odds are you’ve gotten a big envelope from your insurance company in the mail recently. Buried inside, on the third or fourth page, was the proposed premium amount on your Minneapolis duplex.

And, if you’ve had a claim in the last few years on anything you own, chances are that new number knocked the wind out of you.

I’m a good example. I had extensive hail damage at my home. I had someone pass away in a unit and go undiscovered for two weeks. And I experienced a self-inflicted vehicle wound that fell just outside my comfort zone in paying for it myself.

The result?

My most recent proposed rate was 37.4% higher than last year’s premium. I have two homes on the property, and a number of other structures. To put it in context, the proposed annual cost of insurance would be 27% higher than property taxes and interest combined!

Of course, that made me mad. I understand the insurance companies have taken a hit the last several years and fully expected rates to go up. But not like this.

So I looked at my other policies.

Sure enough, a Minneapolis duplex I own had a proposed rate increase of 34%. A triplex in St Paul was a facing a 35% hike. In fact, over the 4 years I’ve owned the latter, its premiums have gone up a staggering 265.34%!

These staggering numbers got me thinking. We talk all the time about the impact higher interest rates have on cash flow. But if you’re already in a fixed rate mortgage, those numbers won’t change.

We have no control over insurance rates. And as climate change continues to result in more and more natural disasters and enormous claims, insurance companies are going to keep raising rates.

The lesson here is to shop your rates. While I was unable to regain all the ground I’d lost, I did manage to erase most of the increases over the last three years.

Has there ever been a better argument against rent control?