Understanding How Tariffs Impact Auto, Home, and Business Insurance - and What You Can Do About It
As the U.S. rolls out tariffs, most notably targeting goods from China, consumers and businesses alike are beginning to feel the effects. While much of the public conversation has focused on prices at the store or the strain on manufacturers, one less obvious but equally important area impacted is insurance.
Whether you're insuring a car, a home, or a business, the economic ripple effects of tariffs are beginning to show up in premium pricing, claims costs, and underwriting strategies.
Auto Insurance: Rising Costs, Rising Premiums
The auto insurance sector is particularly sensitive to tariffs. Tariffs on imported steel, aluminum, and automotive components mean higher repair costs after accidents. For insurers, that translates to higher claim payouts - costs that get passed down to consumers through rising premiums.
Additionally, supply chain disruptions caused by tariffs can delay repairs, increasing vehicle rental times and further inflating claim expenses.
Home Insurance: Construction Materials in the Crosshairs
The home insurance market is feeling pressure from similar dynamics. With tariffs affecting the cost of materials like lumber, copper, and steel, the price of home repairs and rebuilds is climbing. Insurers base coverage and premiums partly on reconstruction costs, so even if your home hasn’t experienced a loss, the increasing costs of materials could still impact your annual premium.
Some homeowners may see updated policy valuations or rate increases as insurers adjust to the inflationary pressure in construction.
Business Insurance: Operational and Rebuilding Costs Escalate
For business insurance, the impact of tariffs is more layered. Businesses that rely on imported equipment or parts may face longer downtimes and increased replacement costs, leading to higher claims and broader exposure to business interruption. Meanwhile, commercial property insurers are reassessing the costs of replacing damaged infrastructure, especially for industries dependent on imported machinery.
In sectors like manufacturing, retail, and construction, tariff-related cost increases could directly influence a company’s risk profile and insurance pricing.
A Time for Risk Review
While insurers are navigating these challenges with strategic adjustments, businesses and individuals can take proactive steps too. Now is an ideal time to schedule a risk review and ensure that your coverage reflects current economic conditions.
At RMC Group, we provide free insurance quotes and comprehensive risk reviews to help you understand where your current policies stand—and where you might improve coverage or save on costs. Whether you're concerned about auto, home, or business insurance, our team can help you prepare for the changing landscape.
Contact us today at 239-298-8210 or email us at rmc@rmcgp.com.
