yep - error me - i’m sure i’ve saved money in policy - but error me.
It’s just so many changes, endorsements…it gets frustrating.
I’d hope the agent would explain the key things…but he didn’t.
He basically said - you need to keep the same insurance for kid driving out of state as others won’t insure - and your roof deductible went to 2%. Didn’t know about the depreciation table and it sucks that is calculated b4 the deductible.
A pricey mistake.
If you try to sell and the inspector says the roof has to be replaced…
A friend had to just ‘fix’ a few minor things on the roof of an investment property to get it sold - whew!
The small insurance checks were just made out to DH, but this Saturday’s $24,000 insurance check was made out to DH and me, along with needing our mortgage holder’s endorsement. Mortgage holder has local credit union branches, and it took about 10 minutes for the teller to go through their computer steps and stamp/sign their check endorsement.
I would NEVER go w/o homeowner’s insurance.
I kidded when I noted that - because the roof is so frustrating.
You think - you have a policy with deductible.
You file a claim. You pay the deductible.
They pay the rest.
Turns out - it’s not that way - on the roof anyway. But it gets more complicated - because one roofer in our estimate said he had to get masonry removed and then put back in to be code. The other estimate did not mention that.
That means - a higher cost than quoted is coming.
Ours will pay $500 and our agent said - don’t file a claim.
But if the costs go higher…ugh what to do.
We’re screwed either way - but buyer beware - and we weren’t aware. Our bad.
The IBHS fortified roof endorsement added just $90/year on our homeowner’s policy. I knew we wanted to pay the extra to keep our roof to $2,000 deductible and IDK what that is costing us, but we believed and believe that is important for us. In AL, that fortified roof endorsement became available in 2022 - and it may have been the gulf coast wind damage issues that had that be with AL insurance (insurance companies requires to offer this endorsement).
Many home insurers have stopped or limited issuing new policies in CA. While wildfires and other group claim risk contributes, I think the bigger problem is prop 103, which limits insurers from increasing rates more than 7%/year without public hearing that can have legal challenges, delays, and other complications. When home prices had a ~50% increase post-COVID and there was a huge increase in cost of construction and replacement, the cost for insurers to replace increased more than 7% they were allowed under prop 103. CA became a less profitable state than other areas without this limitation, so many insurance companies focused on other markets outside of CA.
Many CA homeowners are left with few insurance choices. Some have no insurance choices outside of the expensive state run program. It’s not really a high deductible problem. I think high deductibles are great. I get insurance to cover large claims that would have a notable impact on my finances, not small issues. Even if I had a small deductible, I’d think carefully about filing a small claim, with potential increase in insurance costs for several subsequent years. Unless I know something the insurance doesn’t know that results in having a higher risk level than their model predicts, I favor getting a large discount on rates by choosing a higher deductible.
I live in CA. My home insurance is up for renewal next month. I plan to make a call or 2 to compare rates, but based on my experience last year; I expect to find that I have extremely few choices, and those few choices are all tremendously more expensive than my existing insurance. It’s a completely different experience from pre-COVID where I’d often find multiple good offers when comparing rates.
UPDATE – I just called my previous insurer who had good rates in the past and was in operation last year. The agent I spoke with told me the company stopped insuring homes in CA (both new and existing). The agent asked who my current insurer was. When hearing the name, she said that was going to be my best rate, and there was little point to compare with other insurers.
My recent experience has made me extremely cynical about property casualty insurers. Two claims (not weather related in 20-some years) and while the insurer pays, my company(Chubb) then drops us. My only option was Lloyds of London and I pay 30K for coverage that used to be $12K.
This is home?? Not commercial?? Wow…last year I was raised from $1200 to $2K - and it’s much less than all others were. - for a replacement cost of near $700k.
Amen!
Below is III’s homeowners primer. They are a trade organization. I would use their info when initiating a policy as a framework to understand policy options and consider your needs relative to risk reward tolerance.
https://www.iii.org/article/homeowners-insurance-basics
When using a broker the following is a solid starting point.
Worth taking the time to be extremely thorough when originating a policy. The broker is responsible for answering your questions but you are responsible for telling them your needs and risk tolerances. The eventual coverage is only as good as your input and needs to be read in detail.
Once your coverage is up for renewal you need to confirm that your coverages are keeping pace with inflation and review the cover page which is legally obligated to list any changes.
Cheaper is rarely better in my experience. Theoretically insurance is priced efficiently over large groups of people. This means insurers are regulated to anticipate paying out all of their premiums based upon historical losses, less a regulated profit margin. Stated differently over time you will likely face a loss if insured long enough.
I would much rather “waste” money along the way than save only to face a major uninsured loss. I rationalize my premium as paying over time for an eventual loss. With this in mind I want the best coverage available.
Different people of course might have different risk profiles but getting blindsided can be avoided with a little work.
My experience is different insurance companies charge widely varying rates for comparable coverage. This applies to both home insurance an auto insurance. Different companies have their own risk formula, which applies different weights to different considerations and in some cases includes different considerations, or different labeling/grouping of considerations. They also may have different discounts being applied, which also have different weights. They have different group risk considerations, with different numbers/proportions of other home owners located in a similar region. Some are more or less willing to take short term average expected loss for a potential long term customer. In many areas profit margins are not well regulated resulting in notably varied profit margins going to different persons/organizations within the process, as well notably varied operating budgets.
The end result is insurance quotes can be all over the map, even when coverage is set as close as possible when comparing quotes. I’ve had many insurance quotes that were double or even triple others for comparable coverage.
While your experience may be different, here is the regulatory reality…
“State insurance departments regulate insurance companies’ profit margins through insurance rate regulatory statutes. These statutes are guided by three principles:
That means rates charged may vary for individuals or portions of a geography but the model is designed and regulated as described across a statewide basis by an insurance commissioner. Eventual profitability is mandated and rate adjustments need to be approved.
Yes you can shop rates and look for discounts but ultimately you typically over the long term will get what you pay for in terms of coverage and claims service.
We just closed out a very large claim w/USAA. Sounds like they need to send materials out for an ITEL report to have it graded to get the replacement cost. It took about a week to get the report back for our flooring. Our repairs took over 2 years because of contractor/materials issues. If you have any questions, let me know.
Yes USAA has to get their own ITEL report - and ITEL has already done ‘the work’ with carpet sample and pad sample (from a State Farm claim in 2013) – ITEL just has to be updated with current costs; maybe now USAA will do so. Waiting on USAA this week, and perhaps at the close of the week they will have the roof properly evaluated and they can have their system reflect information correctly – adjuster on Monday couldn’t provide the updates showing this current payment nor the update after the erroneous payment was deleted. The true “summary” which shows all the recap. Then we can sign a contract with our contractor and get materials and the roof team scheduled. We are making progress. I am calling the person who has been responsible over last week and this week, and leaving a message for her.
It’s not commercial. I have no choices. Our agent found only one company that will provide coverage for us. I even called a few companies on my own. No luck. Next year, I’m hoping we can get a new policy. It will then be 5 years without a claim and according to our agent, we can shop around for a better price.
Different states have different degrees of regulation or lack of regulation. There are also different degrees of regulation or lack of regulation for different types of insurance. For example, health insurance often faces very different types of regulation than whole term life insurance. It’s not a simple relationship where all insurances must charge the same rate and have the same profitability. A particular individual can and often will see different rates for comparable coverage between different carriers.
“The insurance commissioner is a state-level position in all 50 states . The duties of the position vary from state to state, but their general role is as a consumer protection advocate and insurance regulator. The position is elected in 11 states and appointed in 39.”
There is no state in the country that does not regulate property and casualty homeowners policies. The policy templates are largely boiler plate and written in “plain English” to protect consumers.
The information is there for the consumer to identify their needs according to their risk tolerances. It does take some work however but is part of basic financial hygiene.
That does not conflict with my earlier post. Different states have different degrees of regulation or lack of regulation, even if an insurance commissioner exists. For example, some states require rate changes to be approved by commissioner (CA, including 7% increase limit I noted earlier). Other states have “no file” systems in which the state does not require rate changes to be filed with state and/or are trivial formality (WY).
We got ours down from $700 a month to $450 a month by switching to Geicko yesterday. And it was a very easy process.
Back 6 years ago when State Farm ‘dropped us’ (would not allow us to continue with home, auto, and umbrella policies but did continue our jewelry policy), Geico would not even quote us if there was a water issue/damage within 3 years. We had previously had auto insurance with Geico before State Farm offered better rate with ‘bundled’. We had home owner’s insurance with State Farm for over 30 years.
But at least we know with USAA we have coverage and continued coverage.
Continued ‘baby steps’ on insurance claim, but getting closer. USAA senior adjustor (Dedicated Catastrophic Claims) was on 2-week vacation, so little was done. Now he is going to do line-item adjustments on the roof materials (IBHS Fortified roof) – adjuster is talking to inspector and contractor and then we will see those adjustments and additional payment, then we can sign a contract and have the roof done. Insurance has been a bumpy road, but it seems they are paying out correctly and we have a good contractor who we have used before. Once roof is started, we can iron out a contract for formal living/dining room and master bath. Insurance to upgrade the line item on flooring with ITEL carpet and pad analysis sent in (we are getting hardwood flooring with paying the difference, which will primarily be with installation as our carpet/pad is tippy top grade). Contractor won’t start on interior until roof is done.
As soon as the interior insurance areas get done, will see what work we want to have continue to be done in our home for ‘refresh’. We have put money into checking account from retirement funds to cover deductible and any upgrades we are doing in ‘torn out areas’ - upgrading flooring in living/dining, and upgrading master bath vanity and going to double sinks in vanity (was plumbed for 2 sinks with initial construction). We also are getting new/upgrade on our two cantilevered decks. Next door neighbor is getting a new deck, and we are getting a quote and getting into the worker queue for our deteriorating decks - the new material will have them looking like new for many years.