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Started By
Message
Homeowners insurance automatic coverage increases
Posted on 8/25/13 at 1:49 pm
Posted on 8/25/13 at 1:49 pm
I bought a house a few years ago and have noticed that each year my homeowners insurance has slightly increased the dollar of some of my coverages.
The dwelling, other structures, personal property, and loss of use coverages have all increased 12.5% since 2010.
Now, perhaps these are built-in increases to account for an assumed appreciation and inflation of values. However, I know that the value of my home/property has not increased at all in these times. Should I call them and tell them to restore my coverage levels to their original values?
The one I'm really concerned about is the dwelling coverage, which is the bulk of the premium.
The dwelling, other structures, personal property, and loss of use coverages have all increased 12.5% since 2010.
Now, perhaps these are built-in increases to account for an assumed appreciation and inflation of values. However, I know that the value of my home/property has not increased at all in these times. Should I call them and tell them to restore my coverage levels to their original values?
The one I'm really concerned about is the dwelling coverage, which is the bulk of the premium.
1
Posted on 8/25/13 at 1:55 pm to urinetrouble
The amount of coverage on your home is based on REPLACEMENT (cost of construction) cost, not market value. The other coverages are a % of the amount of coverage on the dwelling. The cost of reconstruction has more than likely increased will it is very possible the market value has gone down and could be even lower than the cost of reconstruction.
You are required to carry at least 80% of the cost of reconstruction or you would be penalized in the event of a partial loss.
You are required to carry at least 80% of the cost of reconstruction or you would be penalized in the event of a partial loss.
Posted on 8/25/13 at 9:31 pm to Bama54
This is a great question. I speak as a person who lost my home to fire in 2007. I had State Farm ins. They increased coverage each year based in their figures. If you go with their figures, you get a built in 20%increase in your coverage if needed. So for example
House and lot are worth 300k
They say you need 250k coverage (lot and slab will not burn)
In the event of a loss you would have dwelling coverage of 300k.
I can attest, it costs a lot more to tear down your house and rebuild than new construction costs. The difference in premium to get that much more coverage is minimal.
If you have a different provider, check with them and see if they also have a benefit if you use their assessment for coverage.
House and lot are worth 300k
They say you need 250k coverage (lot and slab will not burn)
In the event of a loss you would have dwelling coverage of 300k.
I can attest, it costs a lot more to tear down your house and rebuild than new construction costs. The difference in premium to get that much more coverage is minimal.
If you have a different provider, check with them and see if they also have a benefit if you use their assessment for coverage.
Posted on 8/26/13 at 7:46 am to nogoodjr
quote:
The difference in premium to get that much more coverage is minimal.
Well, if this were true in my situation, I wouldn't even that be worried about it.
However, while my coverage has only increased 12.5% over 3 years, the overall cost of the policy has increased by about 50%.
Maybe the best thing for me to do is too shop around for another provider. Does anyone know if I can switch at any time?
Posted on 8/26/13 at 11:18 am to urinetrouble
quote:
Maybe the best thing for me to do is too shop around for another provider. Does anyone know if I can switch at any time?
Yes you can switch when you desire. Of course the mortgage company needs to be apprised of such. It is a good idea to shop your coverage every two to three years, often you get beneficial pricing as a new customer. I saved almost $850/yr a few years back moving auto and home owners from State Farm to Hanover and changed to Encompass last year for better coverage and a few hundred less cost. My sister saved ~ $600 last month doing this for auto/home with better coverage. Good luck.
Posted on 8/26/13 at 1:08 pm to tirebiter
Thanks.
Any good companies to check with in LA? I'm currently using ASI Lloyds.
Any good companies to check with in LA? I'm currently using ASI Lloyds.
Posted on 8/26/13 at 1:08 pm to tirebiter
Double post
This post was edited on 8/26/13 at 1:09 pm
Posted on 8/26/13 at 1:11 pm to urinetrouble
i got a guy if you want him to put it through a couple carriers
Posted on 8/26/13 at 1:29 pm to urinetrouble
I am not familiar with LA writers. If Amica does insure in your area they would be worth considering to obtain a quote. LA is litigious as shite plus you have hurricanes, etc. I started using an independent agent instead of a captive about 5-years ago after I kept telling my SF agent I was tired of subsidizing crappy drivers and people who would file homeowners claims at-will, which she totally agreed my wife and I were doing. I liked Hanover, too, never had a problem with them but the Encompass policy was more comprehensive at less cost to not switch.
Posted on 8/26/13 at 1:40 pm to BigErn
quote:
i got a guy if you want him to put it through a couple carriers
That'd be great.
Thanks.
This post was edited on 8/26/13 at 2:02 pm
Posted on 8/26/13 at 1:49 pm to tirebiter
quote:
Encompass last year for better coverage and a few hundred less cost.
They are Allstate's high end company.
Posted on 8/26/13 at 1:50 pm to urinetrouble
got it if you want to take it down before who knows what shows up in your inbox
Posted on 8/26/13 at 2:02 pm to BigErn
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