Our Insurance went up by $2,000. Then another $2,000. Here’s our story.
 

Fire and Flood Insurance Is Missing, Not Just Understated

Is home fire insurance a part of the CPI?

This index includes contents coverage for both renters and homeowners, as offered in standardized policies. However, it’s important to note that the approach used for owners’ equivalent rent (OER) excludes certain aspects of homeowners’ insurance, like coverage for physical damage to the structure and liability, according to the Bureau of Labor Statistics.

The BLS says homeowners and tenant insurance index has risen from 152 to 165 in since January 2019.

The total increase is 8.6 percent. Sound right?

What’s the Insurance Weight?

The BLS says shelter is 35.473 of the CPI. Of that, Tenants’ and household insurance is allegedly 0.414 percent.

Sound right?

If you own a home, what percent of your income is spent on your homeowners’ insurance?

Under 1/2 of 1 percent?

Not Counted

The BLS does not include insurance in the CPI as the average person understands insurance.

Nor does the BLS include property taxes or home prices directly.

I understand the manipulative rationale. The BLS says these are capital expenses or operating expenses, not “consumer expenses”.

Lovely. To these pea-brain economists, only “consumer” expenses matter.

In the real world, all of these expenses matter.

A $2,000 Jump, Then Another

Our homeowners’ insurance went up $4,000 in two years.

I won’t name the company, but it is one everyone would recognize.

Video Length: 00:02:52

My mama told me, you better shop around.

We switched to another very big name that everyone would also recognize. We saved $5,000 a year!

I suspect the company we were with was overly invested in parts of the country with severe fire, flood, or hurricane damage.

Regardless, please, check your rates.

Case-Shiller Home Prices

The Case-Shiller Home Price Index declined another 0.3 percent in May.
 

On July 29, 2025, I commented The Housing Top Is Likely In, Case-Shiller Home Prices Drop Again

Percent Change Since January 2020 (Through May)

• Case-Shiller National: 52.1%
• Case-Shiller 10-City: 52.4%
• OER: 44.9%
• CPI Rent: 28.0%
• CPI: 24.3%

Home prices are up 52 percent. That means replacement costs are up 52 percent.

Since fires are increasing and replacement costs rising, insurers have been raising rates. Yet, the BLS tells us that “insurance” is only up 8.6 percent since 2019.

Yeah right.

Supposedly, Rising Home Prices Is a Benefit

Home prices are very high, but this is a good thing for the 65% of households who own them.https://t.co/vKaiWPa33p

— David Doney (@David_Charts2) August 9, 2025

Hoot of the Day: “Home prices are very high, but this is a good thing for the 65% of households who own them.“

Excuse me for pointing out property taxes and insurance.

And think about replacement. If you sell your home, will you live on the street?

There may be a benefit to speculators, but there is no benefit to home price inflation for homeowners who live in their home.

Inflation benefits those with first access to money. The beneficiaries includes the banks, the government, and the wealthy, to the detriment of everyone else.

But hey, content replacement insurance is only up a total of 8.6 percent in the last 6.5 years.

So look on the bright side, Trump Says There Is ‘Virtually No Inflation.’

Here’s proof.

Wharton School of Economics grad has trouble processing % higher than 100.
(1500 percent decrease means drug companies are paying the consumer $15 to take a $1 drug) https://t.co/DxcVacQPi5

— Christopher Gibbs (@ChrisRGibbs) August 4, 2025

“Drug prices are down 1,500 percent. I don’t mean 50 percent.”

That’s quite an amazing achievement given that down anything over 100 percent means they drug companies are paying us to take drugs.

Related Posts

July 15, 2025: Year-Over-Year CPI Jumps 0.3 Percentage Points to 2.7 percent

Month-over-month and year-over-year the CPI rose 0.3 percent.

July 31, 2025: No Improvement in the Fed’s Preferred Measure of Inflation for 8 Months

Core PCE is up 2.8 percent from a year ago, no change in 8 months.

Q: Does the PCE count property taxes or insurance?
A: Of course not , silly, for the same ridiculous reasons as the CPI.

Supposedly, only consumer expenses matter and neither property taxes nor insurance are consumer expenses.

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