Homeowners Insurance

gsganzer · Jul 30, 2019

Good grief, I looked at my renewal bill today and it's nearly $4K/year with Farmers. Prior to this year, our homeowners was always paid through escrow on our mortgage payment, so we probably didn't pay as much attention to it as we should have. Last year we paid off the mortgage, so we now pay it directly. Although our entire place is valued at about $400- $425K, the actual dwelling is only valued at $200- $225K or so. Based on some online pricing calculators for my zip code, my price seems awfully high, but we might have upped our liability due to horses, workshop etc. Calling the agent this morning to see what's up.

Between the homeowners and property taxes, they equate to almost $1000/mo.

atsah · Jul 30, 2019

That's a pile of money... My homeowners is $750 per year and property taxes are $850 a year.. Houses and property in my area are not valued high, if these two bills were as high as other states there would be no one here to pay them..

Diggin It · Jul 30, 2019

gsganzer said:
Good grief, I looked at my renewal bill today and it's nearly $4K/year with Farmers.

Although our entire place is valued at about $400- $425K, the actual dwelling is only valued at $200- $225K or so.

Similar to the car thread where people are talking about rates for insuring several late model vehicles valued at $150K or more, the higher the value, the higher the insurance rates. I finally picked up a Homeowner's policy a few months ago; somewhere around $1200/year for $150K coverage which I think is way too high compared to what I paid for this place.

Half million dollar property with high risk activities (horses) is gonna cost ya'.

TractorNH · Jul 30, 2019

Diggin It said:
Half million dollar property with high risk activities (horses) is gonna cost ya'.

I agree. The insurance company is calculating the risk of a claim. If you have high risk activities others are participating in on your property then YOU are paying for that. One injury and lawsuit (regardless of whether you were negligent or not) and they could easily be forking over a million bucks or more these days to settle a claim.

kenmac · Jul 30, 2019

call an independent agent. They shop several companies. Unlike a captive agent that can only sell one brand.
Would you go shopping at a store that only sold one brand of clothing, food, etc,?
Why shop insurance with a company that can only sell one brand ?

MossRoad · Jul 30, 2019

gsganzer said:
Good grief, I looked at my renewal bill today and it's nearly $4K/year with Farmers. Prior to this year, our homeowners was always paid through escrow on our mortgage payment, so we probably didn't pay as much attention to it as we should have. Last year we paid off the mortgage, so we now pay it directly. Although our entire place is valued at about $400- $425K, the actual dwelling is only valued at $200- $225K or so. Based on some online pricing calculators for my zip code, my price seems awfully high, but we might have upped our liability due to horses, workshop etc. Calling the agent this morning to see what's up.

Between the homeowners and property taxes, they equate to almost $1000/mo.

Also consider the replacement cost of the dwelling. Many peoples' houses would cost more to rebuild from scratch than they are worth in their market.

Think of it this way....you're paying $4K for insurance on $400K of property.
That's like $1K for $100K of property.
Since you have horses, that doesn't sound all that bad at all.
We pay about $1000 per year for a house that's worth about $90K in our market and it also covers our vacant 20 acres about 9 miles away. There's a $1M umbrella policy included in that $1K per year.

kenmac · Jul 31, 2019

It's funny how insurance companies want to insure you. You buy a place for say 500K that includes property and house.
They want to insure you for 500K.
When you try to argue that you only want to insure the home which is xxx, because they aren't going to replace the property if the home burns down. they always have a funny look on their face like you just hit them with a hammer

BrokenTrack · Aug 7, 2019

If the place is paid off, then why have insurance at all?

I have a farm, and so they wanted me to pay $1400 a month. Since I have (3) homes, that would have been $4200 per year.

SCREW THAT!

I have not had insurance for 10 years now, so I have saved a whopping $42,000. Here, we can buy kit houses for $30,000, so I have saved more than enough on insurance premiums to pay for a replacement home. It will not be the same house that is on any of the places now, but what do I care, I just need a replacement home. (Not to mention, if one burns, I would just move my family to a different house).

But insurance is based upon national trends. I can increase the odds in my favor by installing arc faults, GFCI's, high quality smoke detectors, installing a green switch, and not burning firewood, just to name a few options, to decrease my chances of having a fire. Really it is all about being self-insured, instead of paying premiums and bowing to their wishes.

$42,000 in savings is no small amount of money, but like you, I own my homes outright so I am not required by a finance company to put insurance on them. You have freedom now that your home is paid off; use it!

atsah · Aug 7, 2019

Not having homeowners insurance presents a couple of problems.. 1.) Someone can take you're whole property if they have a good attorney.. 2.) If you actually can put the money away and not use it for some other very important situation (which most people have) at some point.

I burn wood, my setup is maintained yearly by a hearth professional, I wouldn't alter my life to avoid a $700 insurance bill every year..

I dislike insurance company's in general but having insurance gives me piece of mind..