The amount of fire insurance premiums increased by 5.6% on January 1, 2022, thus mirroring the increase in the Abex index, which rose from 858 to 906 between November 2020 and November 2021. “More precisely, it is the insured capital, which corresponds to the reconstruction value of the home, which is indexed according to the Abex index. But this upgrade of insured capital obviously has an impact on fire insurance premiums.“, explicit Assuralia.
Such an increase of 5.6% had not been observed since 2007 (+ 5.88%). The Abex index, published according to the evolution of construction prices (which rose sharply in 2021 following material shortages), is used by 98% of insurers to change the amount of the premium.
This index allows, for example, that a house from the 70s is still insured for new reconstruction with a contract signed more than 50 years ago. “Between a building built in the 1970s or 2022, the reconstruction obligations are different. We will not put back a single glazed window today. If the building catches fire, we will put in a double glazed window”, says Pierre Desy, insurance broker.
There is also labor, which is difficult to find and whose cost is increasing. Finally, it is the most important lever, the prices of building materials which are soaring. To this unavoidable 5.6% increase, some companies add another 1.5% by insuring their risks with multinational reinsurance companies. Companies have also seen their premiums increase. “These people provide reinsurance globally so they do not only do it for our Belgian contracts. They are affected globally by a series of natural disasters that are occurring today. They have an impact on the result. “, adds Pierre Desy.
Or how a storm in the United States, a flood in Africa, can impact an insurance premium in Belgium.
