<p>starbright - This is a highly regarded insurance company. They’ve been in business forever. If you could trust anyone, this was the company. It affected me to question all insurance businesses unfortunately.</p>
<p>musicmom - We already carry maximum deductibles the insurance allows. It is not that much and reduces the premium only a little. The liability coverage here is directly tied to the property coverage and the same amount. If I get sued, the insurance won’t help much. BTW, am I the only one mad at the legal profession dictating our life so much?</p>
<p>Iglooo-did you ask them why the rate increase? Has anything changed with your finances that would affect your credit rating? Has your area been hit hard with natural disasters-flood, fire, hurricanes? I guess I don’t understand why you think the policy would only cover part of the construction cost. You don’t insure land so the land value of this property is irrelevant. If the land value is say $500,000 but the cost to rebuild the home on that land is $200,000, for a total value of $700,000 you would only insure the house for $200,000. If this is your main home, you NEED the liability coverage no matter what you think. It isn’t just for rebuilding your home but if someone sues you for damage you cause or something happens on your property, are you willing to lose everything over that? Again, if this is not your primary home and you have coverage elsewhere on your primary home, self-insuring might be ok as long as your umbrella policy extends to this property without underlying coverage. If you need coverage, put minimal building costs on the place, enough to pay for demolition and removal but keep whatever the base amount of liability coverage needed to have your umbrella cover this property.</p>
<p>I talked to the insurance agent. I asked her to find another insurance and this is what she came back with. There was a severe winter storm a couple of years ago that affected almost everyone’s roof. Other than that, I can’t think of any changes. Our lives are pretty uneventful, our finances didn’t see much change. I know the coverage won’t pay the building cost because our new neighbor paid about 3 times of the proposed coverage to make an addition to her house that are similar to ours.</p>
<p>That’s an interesting point about needing it for the umbrella. I may keep it as is for a year while I mull things over.</p>
<p>"I know the coverage won’t pay the building cost because our new neighbor paid about 3 times of the proposed coverage to make an addition to her house that are similar to ours.’</p>
<p>You need to have full replacement value coverage of you want all the costs to be covered.</p>
<p>One thing to consider, if you haven’t already: even with catastrophic fire or storm damage, there will be rubble left on the lot, which will perhaps be an attractive nuisance. So I think you need to keep an umbrella policy. My umbrella policies have always been separate from my homeowner’s policy. Beyond that, are you able to sell this lot without clearing it? Will zoning allow that? Will leaving it as is incur fines? Do you live in an area where potential buyers value this type lot so highly that they will buy it with a very damaged structure? Sometimes what a buyer would be willing to do is dictated by what banks (if the potential buyer needs a construction loan) are willing to undertake. Demolition and debris removal can be very very very expensive.</p>
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<p>I have owned several antique homes. You can insure so that any lost architectural elements are replaced with the same. If my current mid 19th c house burned to the ground, the insurance would pay for me to purchase a similar unrestored house, move it to my property and restore it. Obviously I am insuring for more than the basic cost per sq ft construction formula. Because this is expensive insurance, I keep a very high deductible.</p>
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<p>Are you saying you can’t buy a separate umbrella policy in any amount you choose? I have been able to do so in several states. These policies are usually pretty inexpensive, at least in my experience.</p>
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<p>Because I need rather specialized coverage, I have found it most effective to deal directly with the insurance agencies myself, instead of using an agent who deals with many companies. I can recommend Chubb and State Farm. State Farm has really surprised me after all the Katrina stories, but I had a very unusual claim with them on an antique out-building and they were wonderful.</p>
<p>Now that I think about it, we have to carry certain minimums on homeowners and auto before the umbrella coverage kicks in, too. (We have all our insurance with one firm.)</p>
<p>We haven’t had homeowners insurance since probably the late 1990s.</p>
<p>Similar thing - insurance company stopped insuring in our state (I think that there was a year or two of pretty bad ice storms) and the insurance broker suggested a new company that charged twice as much.</p>