home owners insurance

[clemsonfor]

Thank you. It was 21 years ago or yesterday, sometimes I can't remember which.

So this doesn't come off as a Hijack, let me add this. When Eric was 4 years old my insurance agent talked to me about life insurance on my boys. It was a paid in full policy, $10K per Son, had 3, $450 paid it all. I didn't have $450. My agent said I'll pay this for you. You pay me back when you can. Took me 6 months to pay him off. When Eric died he was among the first to come and visit us. When he handed me the check he apologized saying he never intended for this to happen. I thanked him for being a good man, friend and insurance agent. That money buried Eric.

Again i am so sorry to hear that. This is just so hard to read.

And to pivot back to insurance again, those that know or have collected insurance, do you pay taxes on it? I only have had one claim for my roof and a few small auto claims and i did not claim them. I know on taxes you can claim a loss for uninsured losses. But in the case of your shop, that $193k do you have to claim that as income on taxes?

 

[fordmantpw]

Thank you. It was 21 years ago or yesterday, sometimes I can't remember which.

So this doesn't come off as a Hijack, let me add this. When Eric was 4 years old my insurance agent talked to me about life insurance on my boys. It was a paid in full policy, $10K per Son, had 3, $450 paid it all. I didn't have $450. My agent said I'll pay this for you. You pay me back when you can. Took me 6 months to pay him off. When Eric died he was among the first to come and visit us. When he handed me the check he apologized saying he never intended for this to happen. I thanked him for being a good man, friend and insurance agent. That money buried Eric.

Richard, I'm terribly sorry for your loss. I will never forget what my grandmother told me at my aunt's funeral (she passed due to breast cancer): "Losing your grandpa was easy compared to this. You expect to lose a spouse someday, but you should never have to bury your child."

While that insurance money did not take away the loss or the pain from that loss, I'm sure it helped to take away the burden of how to pay for a proper funeral for your beloved son. And that, in my mind, is the primary reason to have life insurance on children. It is actually a free rider on the policy for my wife and I.

 

[daugen]

I sold a lot of dirt cheap A rated term life insurance during a period of years, and thankfully no one I every wrote a policy for has died, even now many years later.
for most people, buy term and invest the difference made sense. but one had to have willpower and some good luck to accomplish that. If any of my clients could not afford to pay for their insurance annually, I suggested premium waiver due to disability. It kept their policy in force while they were laid up, and if they never did get back to work, the policy premiums were waived on out. And it didn't cost much. And so many folks didn't have personal disability coverage. So waiver of premium met my sniff test for client value in some cases.

Insurance can be incredibly helpful in times of awful loss or stress. Whether due to a bad fire, a bad car wreck, or a loss of a loved one. My late wife was an RN and whose decision to purchase personal disability coverage decades before I met her helped us beyond words when her cancer kept recurring. Those disability payments allowed me to retire at least two years early so i could take care of my wife. Who in the last two years of her life spent one out of four days in the hospital, so many hospitals. But through it all, I didn't have to worry about money.
In this case, she had provided, not me. So I was blessed to be able to care for her every day.
many of us have had some kind of situation where we have been thankful for having insurance.

And I don't think the OP is anti insurance either.
He just wants to know if it makes sense to cut loose on that expense item, to simplify his life.
And the answer is if you have any assets you want to protect, including being able to leave them to your kids,
you had better keep renewing some form of catastrophe protection for what you own. As we get older, the thought of trying to rebuild things
gets really daunting. All we can do in many cases is write checks. And we don't want to go to the poor house in our senior years doing so.
Including the checks we write for insurance...

 

[oldpilgrim]

About 15 years ago, my agent ( who is located about 1/4 mile from the ocean) called me and said my policy was being cancelled because I lived too close to the ocean and was a hurricane flood risk.

I live 15 miles from the ocean. They changed their mind.

Then I got a call saying they were cancelling my policy because I had a dangerous dog.

It's a 10 lb shihitzu. They changed their mind.

Then they called me and said they were reducing my premium costs. I wonder how much I over paid over the years.

I've had my house(s) insured by them since 1971.... and never a claim.

Still, I figure the lawyers have made it so that I can't afford to 'self insure'.

 

[daugen]

I think you should move out to the pole barn now. Try it for six months or a year. Then decide if it's a good backup plan or not.

Also, what happens after the pole barn burns down? Live in a tent?

RV or a singlewide trailer brought in. Ready to go in a day.
it's the paying for it that's the rub...
Actually modular housing, quick fab, could be a huge improvement if made to good code.
Insurance pays for you to check into a hotel that night, but I've had clients in trailers, right on their property so they can watch over it at night while things are being repaired, and yes one in a big RV he rented from a friend.

The bottom line is getting out with the shirt on your back really sucks whether you have insurance or not if your stuff is destroyed. We all know that so we all have to be smart and try to reduce risks where we can. Like never leaving the kitchen while a pan is on a hot stove. Like never putting hot fire ashes down on a wood deck, even in a metal can. Like investing in new house wiring and panels. Like cutting down that rotting tree before it keels over on the neighbor's jungle gym.
By trying to keep Grandma with dementia from burning the place down smoking in bed.

Hurricanes and tornadoes don't seem to spare too many people any more. We are having tornadoes in the East where we weren't used to having them. Some call it Global Warming, maybe it's just the weather news blowing so much out of proportion, but if Mother Nature is coming through, she isn't going to ask permission.

one last thought for the OP: make a budget for what you find comfortable, say 500 a year for point of discussion, and ask your friendly local agent how much coverage that will buy you. He/she has to work around coinsurance issues, but he should be able to come up with a solution for you. You may not like that solution, or it may seem like too little for too much. Then either fall back to a homeowner policy with high deductibles, or if you can afford to do so, just maintain personal liability insurance and self insure for property. The only reason folks are objecting to the OP's self insure consideration is concern for him being warm, happy and well fed this winter, versus something much less attractive.

I never did like tents. Nor bugs on my face.
Dear Santa, all I want is a case of Raid...

 

[buckeyefarmer]

Neighbor up the road from me living in an RV in their driveway. House fire last may. Construction is ongoing on the house.

 

[aczlan]

Again i am so sorry to hear that. This is just so hard to read.

And to pivot back to insurance again, those that know or have collected insurance, do you pay taxes on it? I only have had one claim for my roof and a few small auto claims and i did not claim them. I know on taxes you can claim a loss for uninsured losses. But in the case of your shop, that $193k do you have to claim that as income on taxes?

I believe that you don't claim it as income because the insurance is compensating you for a loss, so your loss balances out the income.

Aaron Z

 

[daugen]

I believe that you don't claim it as income because the insurance is compensating you for a loss, so your loss balances out the income.

Aaron Z

yes, casualty loss. Claim payment tries to return the insured back to where they were one minute before the loss. In reality, you get new stuff, but you lose all the incredibly precious old stuff. Like the Christmas tree ornaments you made with white cotton fluff as a kid...
Insurance replaces lost value; IRS accepts that. Usually no gain seen.

 

[ovrszd]

Correct, no tax paid on that money.

 

[clemsonfor]

just a thought that crossed my mind. I sure would not want all new stuff for the reasons just mentioned. Sentimental value.