Inflation is Here and It Is Affecting Everyone’s Insurance!
What is Inflation and Why Does it Matter?
The Bureau of Labor Statistics measures inflation as the percentage change in the Consumer Price Index (CPI). The CPI is a measure of the "costs that consumers pay for all goods and services purchased by the households from domestic producers" and is used to calculate changes in the cost of living for Americans.
This will affect everyone. Inflation in April accelerated at its fastest pace in more than 12 years as the U.S. economic recovery kicked into gear and energy prices jumped higher, the Labor Department reported Wednesday.
As the world begins to reopen and people reintegrate into their normal activities, we are faced with a lot of uncertainty about the future. Businesses which were closed a year ago are reopening this year and we are seeing increases across the board for all goods and services. This is not a good thing and we do not even really know what is happening yet.
Of course all the printing of money brings fears of Hyperinflation. This is a doomsday scenario for modern economies throughout the last century. In all of these failed countries (Zimbabwe, Venezuela, Hungary, Yugoslavia, etc.) there have been uniform warning signs, the same signs that we are starting to see today in the U.S.
Economic downturns are unfortunate realities and fear continues to build as we do not exactly understand what the effects of this past year will be. All we know is that we are already seeing prices skyrocket throughout different sectors.
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With building costs on the rise, an insurance policy already in effect prior to the economy experiencing the rapid inflation of building materials will not cover you in the event of a total loss.
If we have not reviewed your policy recently, reach out to us and let’s schedule time to make sure you are fully insured.
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