The rising cost of goods and services impacts clients in more ways than just their cash flow. Last week I referenced an inflation graphic published by the New York Times that illustrates the effect of inflation on various spending categories. Rising inflation not only leads to potential changes to spending, it can also leave clients under insured by surprise.
Rising Replacement Costs
According to data published by the BLS, material prices for construction projects (including diesel fuel) have increased a cumulative of 30.2 percent from December 2003 to January 2008. This is more than double the reported increase in the Consumer Price Index (CPI) of 14.5 percent for the same period.