Homeowner's insurance ~ HELP!

[marv]

When I was in the industry, the acceptable loss ratio for bodily injury for auto coverage was 53%. That meant that an insurance company expected to pay out $53 from every $100 collected in premiums. After salaries, mine was $450/mo, and expenses like office space, travel for adjusters, etc., the profit margin came in at about 2% on average from which to pay stock holders. Grocery stores had about 3% to 4% profit margin.

Rates are controlled by the states. If an insurance company wanted to do business within a state, they submitted their rate proposal to some state board. If the state approved them, they did business. If not, and the company concluded that they couldn't afford to do business in that state, the company withdrew from that state. That has happened in Florida after massive losses from huricanes, but after contracted losses have been paid according to the terms of the policy - and there will be scrutiny by the adjusters.

Remember that an insurance policy is a contract between a company and an insured. It works both ways, and it ain't a blank check. If the insured has the freedom to not renew a policy because of increased premiums, so does the insurance company to not offer a policy renewal because of past paid losses or expected future losses.

[namvet]

Heard that Reading was too. Every structure in the entire town was damaged.    According to the news report I saw last night on ABC, only was person was killed. There were only 2 churches in the town, and only one of those had a basement. News said that a bunch of people took shelter there, and that's why they survived.

so far 89 dead in Joplin. the town looks like it was carpet bombed. the Hospital was heavily damaged including patients who died.

Tornadoes Rip Across Midwest; 89 Dead in Joplin, Mo. includes vid. that looks like an F-5


story

[formerlurker]

I had State Farm several years ago, for homeowners and my cars.

In one year, first a freak windstorm takes down a tree in my front yard, not doing any damage to my house, but it took down utility wires and the cover for them on my neighbor's house. I called the emergency claim number, and was told neighbor's HO policy would pay for their damage as it was "an Act of Nature", since the tree was not dead. Their insurance company tried a couple of times to get mine to pay for damage, even went so far as to talk to utility company and tree cutters as to whether or not the tree was dead...all said it was not. State Farm DID NOT pay any money out to me or the neighbor.

Next my son's car was parked on the street in front of our house and was broken into. He had his backpack in an expensive calculator in it, one of those mega CD holders and some other personal stuff, taken. Plus the thieves took the stereo system he had put in. And of course they broke the window. Car was actually mine, and he was living at home at the time. Claim was paid....and since it was a break-in on the car, claim was on my homeowner's policy.

1 day short of a year later, from the car episode,  I turned in a claim for a new roof due to a hail storm. New roof. State Farm paid it. Month later, I received a cancellation notice from them for having too many claims in a year.  

Best friends' daughter and son-in-law have 2 Nationwide agencies. They have gotten very quick response on the damage from our storms the end of April.

I know after Katrina and then Wilma...both State Farm and Allstate stopped writing HO insurance policies for the remainder of 2005. Not sure how widespread it was, but I know people here that were buying new homes (for them) could only get State Farm or Allstate on the new house if they already had an active policy in their "old" home. First time home buyers were having a very had time getting HO insurance, and I know - at least in my office - it was coming down to time of closing before people were able to get insurance. It was a real mess.

I would not be at all surprised to see it happen again this year, with all the disasters happening. Local paper reported over $200million in claims just here from the April 27th tornadoes. That was about 2 weeks ago, I would not be surprised to see it go quite a bit higher. Every house in my subdivision (116 houses) is getting new roof(30year dimensional roofs) guttering and downspouts, all roof vents. I don't know how many are getting new windows, but most are getting at least some new screens(I'm getting 13), many are having their decks resurfaced and refinished (I am), holes in siding(I have), outside lights, outside furniture and grills, AC units repaired (I have 2 that are damaged). BFF's getting all new siding too, even though she only has damage on 2 sides,  because her color has been discontinued, so the whole house will have to be redone...her house is only 7 yrs old.

As extensive as the damage is around here, it is nothing compared to south of us in AL. Add in the floods, and now all the new damage from this weekend. News said last night there were 872 tornadoes in the month of April! May is technically the start of tornado season, and June is technically the start of hurricane season that continues to the first of November. How much damage is yet to come? Will some companies stop writing policies.

The Nationwide adjustor told my friend that roofing costs had already had one increase, and that whatever he determined their amount (or anybody's) of damage and amount of reimbursement, would NOT cover their repairs, because of supply/demand, the unprecedented high number of claims in so many states...there just isn't enough product out there which is going to cause long delays in some repairs. Once they get estimates, they are to submit them to Nationwide for review. There is a 6 week wait for car windows.

Both my next door neighbor and the people behind us, haven't even seen their adjustors yet. So far, I've only seen 4 new roofs go on in here. Supposedly, house closings have been halted due to extensive repairs being needed and no one wants to close without them being done. I know a lot of houses have been pulled off the market due to damage.

Again....we have NOTHING here, compared to so many places.

According to the weather people, this current weather pattern through the midwest and south is to continue for several more days....

Insurance carriers have insurance for catastrophic losses from mother nature (through Lords of London and the like).   They purchase insurance as we do, so for one act of mother nature (tornado that leveled the town yesterday), they would pay out $___ amount in claims, and then be reimbursed for everything they paid out over $1, 2 million to throw a number out.     The problem is their re-insurance premium rates are based on their risk also for the coverage areas, so once they can no longer afford to do business in a state  (with the considerations that Marv pointed out), then they have to pull out. 

I strong advise against filing homeowner's claims unless it is for something like replacing a roof or something similar.   The car being broken into would have definitely been a loss you just write off on your taxes, and not a homeowner's claim. 

[namvet]

Insurance carriers have insurance for catastrophic losses from mother nature (through Lords of London and the like).   They purchase insurance as we do, so for one act of mother nature (tornado that leveled the town yesterday), they would pay out $___ amount in claims, and then be reimbursed for everything they paid out over $1, 2 million to throw a number out.     The problem is their re-insurance premium rates are based on their risk also for the coverage areas, so once they can no longer afford to do business in a state  (with the considerations that Marv pointed out), then they have to pull out. 

I strong advise against filing homeowner's claims unless it is for something like replacing a roof or something similar.   The car being broken into would have definitely been a loss you just write off on your taxes, and not a homeowner's claim. 

and if you call your ins to come out and est the damage that's a claim. I just call the damned roofer

[marv]

Here's another suggestion for auto accidents. Get one of those throw-away cameras from a grocery or drug store, and keep it in your glove box (yah, I'm that old). If you are involved in an accident, grab it and get pics before anything is moved or changed.

Not an auto accident, but we used to live next door to a resort here on the lake. After a two foot snow fall about a dozen years ago, their dock's roof started to collapse, and it started to sink under the weight along with some boats stored for the winter. Sherry Lee saw me take the pics, and asked for copies. I gave her the Polarid pics and she could go ahead and get some estimates. It helped with filing the claim.

[CG6468]

same here. only claims on my home has been hail damaged roof. and they now have a hotline to give local reputable roofers. a big plus since storm chaser's get there first. 

Oh, yeah. I forgot about the hail damage to the roof vents. That was no problem getting covered, either.

[Gina]

well so far Allstate ($853/yr) and Liberty Mutual ($880)

[namvet]

well so far Allstate ($853/yr) and Liberty Mutual ($880)

not bad. if you have a mortgage its just part of your escrow

[Lacarnut]

well so far Allstate ($853/yr) and Liberty Mutual ($880)

Make sure and read the deductable on the Allstate policy. In Louisiana, it is 5% of the home value. So, if you are insured for $200,000, the deductable would be 5% of 200k=$10,000. So, if the roof cost $15k to replace, you would be responsible for the first $10k. Like another poster stated, cheap is not always the best. After Katrina, there were many homes with blue tarp draped over their roofs for several years.

[namvet]

just got this. the hospital in Joplin mo - death count now at 116. did someone mention insurance???

[TVDOC]

well so far Allstate ($853/yr) and Liberty Mutual ($880)

We've had Allstate for about five years on both the house and car.  Had a big hailstorm  here last August, and they paid out over 20 grand to repair our house and car (roof, windows, siding, three garage doors, and an A/C unit).  Excellent claims handling, and the only rate increase was that I lost a 10% "no claims" discount for another three years.

I'm pleased with them, and they are competitive (I shop the prices every year or so).

doc

[formerlurker]

well so far Allstate ($853/yr) and Liberty Mutual ($880)

Not bad at all.

[Wineslob]

well so far Allstate ($853/yr) and Liberty Mutual ($880)

I've got Allstate, but it's all rolled into one. Home & auto. I think my yearly is around $100 less that what you posted, but I am a long time member.
I've had a homeowners claim (2001/ wind/rain damage) and another in 2010 (stolen log splitter). My rates never went up.

[Gina]

Ok, I got my current insurance (Nationwide) to fax me my Homeowner Policy Declarations

Coverage-Dwelling $155,000
other structures $15,500
Personal Property $114,750
Loss of Use $155,000

Ok...........tell me something

this is from the tax assessor on my property

Land Appraisal:    $ 34,000
Building Appraisal: $ 84,500
Total Appraisal:    $ 118,500


do those numbers on my insurance policy jive with what the tax assessor says?

[marv]

Ok, I got my current insurance (Nationwide) to fax me my Homeowner Policy Declarations

Coverage-Dwelling $155,000
other structures $15,500
Personal Property $114,750
Loss of Use $155,000

Ok...........tell me something

this is from the tax assessor on my property

Land Appraisal:    $ 34,000
Building Appraisal: $ 84,500
Total Appraisal:    $ 118,500


do those numbers on my insurance policy jive with what the tax assessor says?

Appraisal valuation does not equal replacement cost. Pay an appraisal company to give you a reasonable valuation of your property. They're third party, and have no interest in taxes or insurance premiums.

[debk]

An appraisal will cost you $350.

Unless you've had a property tax assessment done in the last year, chances are it's off.

Problem is, what property is selling for, anywhere in the country, is probably lower than what it would cost to replace the dwelling. Especially with all the disasters, building materials are going to increase in cost. I know that roofing has at least once, if not twice, since mid-April.

I know you are in the Memphis area...are you living in the state of TN?
If you are, I can pull the comparative sales around you from the county tax records, or you can go down to the tax assessor's office and ask for them yourself.

[Gina]

An appraisal will cost you $350.

Unless you've had a property tax assessment done in the last year, chances are it's off.

Problem is, what property is selling for, anywhere in the country, is probably lower than what it would cost to replace the dwelling. Especially with all the disasters, building materials are going to increase in cost. I know that roofing has at least once, if not twice, since mid-April.

I know you are in the Memphis area...are you living in the state of TN?
If you are, I can pull the comparative sales around you from the county tax records, or you can go down to the tax assessor's office and ask for them yourself.

hey that would be great deb, I live in Memphis TN.  My bil is an appraiser....guess I could ask him to do it.

[debk]

hey that would be great deb, I live in Memphis TN.  My bil is an appraiser....guess I could ask him to do it.

Your BIL could do a quick comparative market analysis...that would give you an idea what your house would sell for on the current market. It would not be like a true appraisal, but just a comparison with properties similar to yours. He would know your market, if he lives there, and he also knows what your house looks like. If he can't, let me know, and I will help you. I will need some specific info from you, and we can do it by email, rather than here to protect your privacy.

Most important thing to do with your HO insurance, in my opinion (got it from my dad and step mother who were in the insurance business themselves most of their adult lives)...is that you have "replacement cost coverage insurance" coverage, in order to replace what you had in place, not what the insurance company values what you had in place. This covers you for replacing at current prices, and without any depreciation on the item. I have always put a higher amount than the usual percentage amount for contents. It costs a bit more, but as my dad pointed out, I had things (collectibles, oriental rugs, etc) that to replace would be difficult and at a higher cost than when purchased. As an example....just look at your shoes(    ), or the kids toys and clothes, or your husband's tools, guns, golf clubs. Look at your current policy and see what amount it gives for jewelry, or guns, or collectibles...unless you have a separate rider policy for them....and see how much replacing them would eat up of your contents dollar amount. Then add in your kitchen, clothes, furniture, etc, and the contents amount rapidly disappears. Pictures and videos of your contents are really important.

[Wineslob]

Ok, I got my current insurance (Nationwide) to fax me my Homeowner Policy Declarations

Coverage-Dwelling $155,000
other structures $15,500
Personal Property $114,750
Loss of Use $155,000

Ok...........tell me something

this is from the tax assessor on my property

Land Appraisal:    $ 34,000
Building Appraisal: $ 84,500
Total Appraisal:    $ 118,500


do those numbers on my insurance policy jive with what the tax assessor says?

In Cali we don't ever let the assessor know they are under value.   

[debk]

In Cali we don't ever let the assessor know they are under value.   

We don't here either....

We also don't tell them if the house is larger than they think it is. 

Usually the only time they have it right, is when there is a property transfer. Then they use whatever the appraiser measured the house to be, and they use the sale price for valuing the property.

Years ago, when I went through my divorce, and appraiser was involved to determine the value of our house and contents ( ). I ended up taking over the house( and 2 mortgages) and gave him sole ownership of the ridiculously priced quarter horse he bought a month before we separated.  When the next tax assessment came out the following year....the house value and size used in the divorce, was the new size and value used by the tax assessor. Yeah, it was great....an additional $60,000 was added, and I got to pay the taxes on it. Not a thing I could do about it either, because it was accepted by the Family Court judge as fact.

[formerlurker]

Ok, I got my current insurance (Nationwide) to fax me my Homeowner Policy Declarations

Coverage-Dwelling $155,000
other structures $15,500
Personal Property $114,750
Loss of Use $155,000

Ok...........tell me something

this is from the tax assessor on my property

Land Appraisal:    $ 34,000
Building Appraisal: $ 84,500
Total Appraisal:    $ 118,500


do those numbers on my insurance policy jive with what the tax assessor says?

I don't know what kind of house you own, but just framing a house can run $75,000 here in the Northeast.    Your tax appraisal no way reflects what it would cost to replace (rebuild) your house.   You are insuring your house to replace it, and its contents.   Insurance does not cover land.  

[Gina]

Ok, I spoke with nationwide and they told me they adjusted my house from 155k to 138k and raised my deductible from 250 to 1000.  That knocked the yearly premium down to 1018.  Still not good enough.

[Toastedturningtidelegs]

Ive had farmers many years now. and I get a home 2 car discount. but homo ins is going up from inflation. I paid 100 grand for mine in 94 and it would almost cost 170 to replace today. shop around time. just make sure they show up after a disaster

ps: its my real estate tax's im pissed about !!!!

Meh! I don't bother to insure my homos...They break? I just get a new one!

[marv]

In a nutshell...

1. Forget about tax assessments. That's just to factor in property tax rates. Nothin' to do with insurance valuation.
2. Get an appraiser to determine valuation for insurance purposes. Keep your homeowner's or fire policy within the co-insurance limits. That's important! Typically it's 70%, or thereabouts.
3. Finally, READ THE DAMN POLICY. Don't understand something? Get your agent to explain it to you.

After all, it's your money whether you pay too much in premium, or you get too little for a loss.

[debk]

Ok, I spoke with nationwide and they told me they adjusted my house from 155k to 138k and raised my deductible from 250 to 1000.  That knocked the yearly premium down to 1018.  Still not good enough.

Can you replace your house - materials, quality, size - and ALL your contents for $138k?

Just think about your contents....Christmas decorations, kids toys, books, EVERYTHING in your kitchen. Clothes for 5 people. YOUR SHOES! Look at a Rooms to Go ad this weekend, and how much it would cost to replace all your furniture.

If you can't, you don't have enough insurance.

Figure on your house at a minimum costing $50/sf to replace. With all the damage across the country from disasters...building supplies are rapidly increasing (they did after Katrina, and never did come completely back down to pre-Katrina prices)...you are probably looking at closer to $65-75.

I don't know what size your house is, but 1500SF x $50 = $75,000.....1500SF x $75 = $112,500!

That leaves you $25,500 for contents.

5 rooms of furniture at $2000/room = $10,000.

You would have roughly $15,000 to replace everybody's clothes, toys, books, kitchen stuff (dishes, cookware, existing food staples in your pantry - incl spices - which are ridiculous - and refridge!), cleaning supplies, guns, bed/bath linens, whatever is covering your windows, computers, cameras, all those cute earrings, necklaces, and scarves you wear.

My son has to wear a plain red mesh-knit polo shirt to work. Picked up one for him last night at Walmart for $8.97. It's a Faded Glory but should wash ok and be fine unless it fades out too much. Next cheapest I have found was $19.95 on sale. How many polos does your husband have? Most guys probably have at least 15-20 of them. That's somewhere between $200-400, just in your husband's polo shirts!

Have you gotten estimates for having both house and cars/boats insured by same company? It's usually cheaper to do all with one company.

Paying insurance really sucks, because the chances of you needing it for a total catastrophic occurrence are quite slim...but I bet all those people in Alabama or Joplin Mo never expected to lose everything in 20 seconds either.