Homeowners Insurance

[gsganzer]

I called my broker to discuss my policy. There's a couple of things that drive the cost. Texas is 7th highest in the nation for homeowners insurance. I don't remember the term, but my policy is one that favors the insured (me) with very few exclusions and loopholes that the insurer can claim. I have $500K in liability. I have a 30 x 40 workshop/in-law apartment and it's contents that are covered. We have a fairly high value covering contents, but considering what we have, it's a reasonable value.

One thing to also remember concerning your homes value. The cost to rebuild your house in the event of a disaster is not the same as what you would sell it for or equal to simply building a new house. You typically have a demo and cleanup first, before you can rebuild.

 

[CobyRupert]

We've done this thread before. Insurance of any kind is gambling.

Yep! :thumbsup:

...but unlike a horse track or casino that you can choose not to go to, there's no getting out of the gamble. You either gamble you WILL have an insurance claim and aren't wasting your money; or you gamble you won't have a claim and can put that money to other uses (including self-insure).

 

[fried1765]

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!

But.......if you paid the $42,000 of insurance premiums, with a 2% cash back VISA card, you could have earned $840 (2%) cash back!

 

[atsah]

If the building is worth $400k and you are only insured for $200 they can claim U are co insured and you'll only get 1/2 your loss.

So if you take out a policy for 200K on a property that's worth 400K, you want 400K if it's destroyed?

I'm no mathematician but that makes no sense..

 

[fried1765]

The self insurance idea is great until this happens. View attachment 616212

If I had been self insured in 1987 I would have lost $247,000 (in 1987 dollars).
Thankfully the insurance company (USAA) ate the $247,000 bill ......not me!

 

[fried1765]

Paying for a beater vehicle worth 10k or less is very insignificant compared to to the liability cost. I pay about $70 a year more for full coverage.

Not sure what you mean by "full coverage".
"Full coverage" can only be on damage to your own vehicle.
Damage to property, and liability, is sold with specific dollar limits, and the premium varies with the dollar coverage you select.

 

[fried1765]

Older vehicles cost more for full coverage because body parts and such are hard to find. my 93 suburban is only worth about $1500. My deductible is $2K. :laughing: I have liability only on that one.

^^^^^^same here......97 Suburban

 

[4570Man]

Older vehicles cost more for full coverage because body parts and such are hard to find. my 93 suburban is only worth about $1500. My deductible is $2K. :laughing: I have liability only on that one.

I’m not sure about that idea at least limited to fairly common models. A new aluminum hood is over $1000 without paint. I could buy a complete 90s vehicle to salvage the sheet metal for that much.

 

[Diggin It]

If I had been self insured in 1987 I would have lost $247,000 (in 1987 dollars).
Thankfully the insurance company (USAA) ate the $247,000 bill ......not me!

I'm having trouble getting even the most basic information out of them. I've also been reading how others are having great difficulty with claims. I'm wondering if they (like so many others) have changed their practices in the last few years to be less consumer oriented.

 

[Diggin It]

I’m not sure about that idea at least limited to fairly common models. A new aluminum hood is over $1000 without paint. I could buy a complete 90s vehicle to salvage the sheet metal for that much.

I keep hearing about how simple 5MPH parking lots bumps can cost thousands of dollars in claims.