An extraordinary number of catastrophes, the high cost of repairs and excessive jury awards due to the emergence of toxic mould claims have pushed the cost of US householders insurance up by 17% over the past two years.

The Insurance Information Institute (III) said insurers paid out about $200 billion in catastrophe-related losses over the past 12 years,  “Homeowners insurance rates in many parts of the country continue to rise because of the extraordinary costs associated with paying these claims,” the III said. “In fact, virtually every part of the country is now at risk for billion-dollar disasters.”

With loss ratios at 118% over the past 10 years and a $15.8 billion underwriting loss in 2001, there’s plenty of reason for the US industry to say the hard market is here for at least another couple of years. Losses in householders insurance over the past three years are estimated at $33.7 billion, rivaling the $36 billion in insured property losses from the September 11 terrorist attack.

Mould has recently emerged as the dominant cost driver in some states, according to the III. Domestic mould claims – which were virtually unheard of just a few years ago – cost insurers more than $2 billion last year. “Mould is certainly not new – it’s been around for hundreds of millions of years – but the sharp rise in mould claims is a 21^st century phenomenon,” the report said. “Multi-million dollar jury awards, sensationalised reporting in the media and profiteering by some individuals have led to an explosion in mould claims and costs.”

The average cost of insuring cars in the US is also expected to increase – by 8.5% last year and 9% this year – due to rising medical costs, higher repair costs and soaring jury awards in liability cases.