Need Advice on Homeowners Insurance

[RealPerson]

For many years, we have been with the same homeowners insurance company. Quietly, over time, the premiums keep going up. The cost seems to be really high now. So, I asked for a reassessment of the insured property value.

An inspector came and walked around the outside of the house while I was not home. There was a modest decrease in my premium.

A month after this, I get a canned letter from the company, explaining that the homeowners insurance premiums are being raised due to increasing building cost, etc. So my decrease is partially reversed. Aaahhh!! My insistance on the phone that my premium is too high has gotten me nowhere.

So, my question is what the strategy should be. My deductible is the highest they offer and I have not done anything major to the house in 14 years. Also, I have no pool and no trampoline. If anyone has any suggestions on strategies to keep the premium low, I would love to hear them.

[slsdly]

I'd be interested in hearing on strategies for this too. I had a ~30% increase in premiums one year and the company could not tell me *why*. The person on the phone agreed that it was unusual since I had no claims or changes in coverage, and that there was no systematic increase across the board. But they claimed there was nothing to be done!

I called another company, got a significant reduction in price and cancelled the old policy. I assumed after that it was just company (industry?) policy to screw over customers who don't pay much attention and/or aren't willing to fight over it.

[Ego]

You may want to order your CLUE report.

https://www.privacyrights.org/clue-and- ... s-size-you

[SimpleLife]

Insurance is one of the biggest rackets in the US. Lobbyists own our lawmakers. How else do you explain that you can pay tens of thousands of dollars in premiums over several years, then get in an accident and have the insurance company deny to pay the other party, which results in YOU getting sued by the other party, just because, as it turns out, the insurance company knows it's a frivolous claim. Imagine how this affects you on background checks now for jobs. Oh, you've been sued...interesting.

Say the same for a house. You pay and pay then when you file a claim, oh, sorry, we are going to deny it. They make it as difficult as possible. But I digress. I saved a bunch of money by switching my insurance from Progressive (homesite "dis"advantage) to AllState. I actually switched because I wanted to buy an umbrella policy but needed to have all my insurance through the same company to do so, since they raise the liability limits on your auto and home policy before writing an umbrella policy.

My rental and home owners insurance were cut in half. My car insurance increased 40%!! Now, several months later, my umbrella policy, landlords policy, and homeowners policy have steadily kept going up. WTF!?!?

I'm about to go live in a van here pretty soon if they keep this crap up. Oh, yeah, that reminds me, I need to shop around for insurance. I recommend doing this every 6 months. You'd be surprised how switching once in a while will cut your rate in half.

[dot_com_vet]

I go with a local agent/friend. My gut tells me I'm paying too much, so I get competing quotes every couple of years.

My local agent continues to be the cheapest option surprisingly.

I was with Progressive in the past who had huge annual increases. When I cancelled they offered to cut my premium in half. WTH. I cancelled anyway.

I do expect increases based on market performance, inflation, and disasters. Appliance prices have increased 5%/annually the last few years, if that's any kind of benchmark.

[Dragline]

Go shop. I recently reduced mine by half. The insurance companies are counting on you to just renew, especially if you are paying it through a mortgage payment.

[JohnnyH]

Also consider ditching insurance entirely... I imagine this won't apply to most but I used to live in a house where the value was close to my annual wages. There was no mortgage, so I never got insurance.

You can deduct casualty from fire/theft against your yearly income taxes without jumping through insurance claim denial hoops and paying a monthly fee.

[JamesR]

I skip insurance just about every single time. Airfare insurance? Skip! Transporting stuff insurance? Skip! Sounds like a good idea to skip home insurance where possible, though fire/disaster insurance might be a good deal?

[Scott 2]

Centralizing auto and home insurance with a single carrier seems to help.

USAA has been consistent for me in keeping stable rates and not playing games. I've not had to file any claims, but from what I understand their service is pretty good.

Having less valuable property to insure helps. As does insuring the value of the dwelling, not the land. In high cost of living areas, the two are very different.

I keep my deductibles relatively high, since insurance is a hedge against risk I cannot afford. I don't think I'd do totally without though. Outside of my residence being a relatively high percentage of my net worth, I want protection from someone getting hurt on my property.

[tommytebco]

USAA is busting my chops, personally. Mainly from home owners.

$400/year in 84 or so to $2500/year this year. And not apologetic at all. I had no claims in 2004 when 4 hurricanes crossed over my roof. I've never had a sink hole anywhere near me.

I'm seriously thinking about self insurance. I own the house outright. In today's depressed markets, it is worth something a bit over $40K. But, one of my childhood lessons was to never be uninsured. I'm having trouble with that indoctrination.

[Scott 2]

My insurance is around 800 a year on 220k. Yours seems incredibly high.

[KevinW]

I agree with the principle of declining most insurance, instead self-insuring with cash. That way you are earning interest instead of paying premiums. BUT, I think liability insurance is worth it on things like houses and cars. An FI EREr with a paid-off house and hundreds of thousands in taxable brokerage accounts is a ripe target for a "your sidewalk broke my back" lawsuit. The liability part is relatively inexpensive and seems worth it to me.

[JamesR]

Liability might be handled better by putting the house inside a trust?

[JohnnyH]

$2500/year this year...
I'm seriously thinking about self insurance. I own the house outright. In today's depressed markets, it is worth something a bit over $40K.

That's over 6% a year to insure, insane. Anything over 1% is too much IMO. I'd cancel that tomorrow.

Hurricanes are almost always declared federal disasters, so you'd be able to deduct the full value + associated costs over a 2 year period.