Homeowner's Insurance
Do you ever check for competitive rates for your Homeowner's insurance?
I never have. Have the same company (State Farm) for the past 20 years.
Mine is scheduled for renewal in November at a cost of $1,600.00. Our home (dwelling) is insured for $231K, far more than the selling price would be.
Neighbor just had his home appraised at $180K and his has more square footage than ours.
Should I have the coverage reduced from $231K to be more in line with a actual selling price?
Don't know how much of a reduction I'd get, but $1,600 is a lot of money.
I never have. Have the same company (State Farm) for the past 20 years.
Mine is scheduled for renewal in November at a cost of $1,600.00. Our home (dwelling) is insured for $231K, far more than the selling price would be.
Neighbor just had his home appraised at $180K and his has more square footage than ours.
Should I have the coverage reduced from $231K to be more in line with a actual selling price?
Don't know how much of a reduction I'd get, but $1,600 is a lot of money.
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Selling price is different than rebuilding price and, value of contents. 0 -
quote:Originally posted by Chief Shaway
Selling price is different than rebuilding price and, value of contents.
And often separate policies covering each could give you better "protection" than a one-size-covers-all single policy.0 -
What Forge said, the cost to replace your structure will far exceed the "appraised value".
We don't shop around for homeowners, because our house is old, and not every company will insure old houses. We have been with Farmers since 1991.0 -
No harm getting a competing quote, might find a lot less.
Sadly most companies go up every year without any consideration that you have never filed a claim.
The hungrier companies who want to add accounts in your area will generally be less expensive.
I was loyal with Liberty Mutual for years, never filed a claim not one and they kept nickel and diming me. I went to Geico for awhile and they played the same game, finally switched to Progressive and I will dump them too if need be. I checked with USAA but much higher rates than what I have now.0 -
Don't forget they have most people hooked since they owe a mortgage. Remember reducing the premium reduces the content coverage and external building coverage. However..most times it is not a total loss. The foundation will still exist. Take pics of contents because you will need them to verify. You can also raise the deductible to reduce cost. 0 -
Pays to shop around... 0 -
insurance and taxes are our two biggest bills..and if the demonrats get in power they will be much higher..i amd selling off property to get out of this circle....have had ZERO debt for many years.... 0 -
My insurance agent shops around every year to make sure I get the best deal. She is a shooter & good friend ! 0 -
Compared 5 different company?s and went with Hartford through AARP....well satisfied with them after 12 years.... 0 -
State Farm for everything:
House
Cars
Guns/Jewelry
Been happy with them.0 -
I have State Farm too. Yep to what Forge said and to what SF said. Have pictures of your contents otherwise you're screwed. You can get seperate policies for guns and other valuables and in this day and age a baloon policy is also a good idea. They're usually not much $ and well worth it if you need it. It's to cover you for lawsuits. 0 -
Never did understand how replacement costs can be more than market value. Market value includes the land. Replacement is building only and no way the foundation would be gone unless earthquake. 0 -
quote:Originally posted by slumlord44
Never did understand how replacement costs can be more than market value. Market value includes the land. Replacement is building only and no way the foundation would be gone unless earthquake.
Why Reconstruction Usually Costs More Than New Construction
Economy of Scale ?C When a contractor has many homes under construction at once, materials can be purchased in large quantities for delivery as needed ?C everything from framing lumber to plumbing fixtures. If you buy a large number of bathtubs, for example, suppliers will compete for your business and offer price discounts. When you buy just one bathtub, and it must be a match for one that's been destroyed, it will nearly always cost much more than if it had been part of a larger purchase. This holds true for almost everything that goes into a home and this factor alone can push the cost of rebuilding thousands of dollars higher than the cost for comparable new construction.
"Top-Down" vs. "Bottom-Up" ?C New construction begins at the foundation and builds upward. Repairing a house that isn't totally destroyed often means removing the roof and rebuilding from the top down, a far more time consuming and labor-intensive procedure.
Demolition and Debris Removal ?C New home construction normally begins on open ground, perhaps with some brush removal and grading and other minor site preparation. Rebuilding begins with a partially or totally destroyed structure occupying the building site. Parts of the structure may still be standing but unusable, requiring demolition and removal. The site may have to be extensively cleaned ?C after an intense fire, for example, the soil may be contaminated. The foundation may have been damaged beyond repair. A lot of work is usually required before the first cement can be poured or the first nail hammered in.
Use of Labor ?C When a new home builder has several houses under construction, even if they aren't all in the same area, work can be scheduled for the most efficient use of carpenters, plumbers, electricians, and other workers. If one house isn't ready for wiring, the electrician can probably work on another. When only one home is being built, the same kind of efficient scheduling is rarely possible. Labor normally accounts for the largest share of homebuilding costs.
Access to the Worksite ?C When new houses are under construction, there is usually no landscaping, allowing easy access to the site. Materials can be driven directly up to any side of each structure as needed. When a house is being rebuilt among existing homes, there are trees, shrubs, lawns, flowerbeds, fences and other obstructions limiting access. Materials often have to be off-loaded further away and hand carried to where they're needed. This factor is compounded if the building site is on sloping ground. The impact on labor costs can be significant.
Special Features & Unusual Materials ?C Older homes and homes that have been extensively remodeled often have customized features or include materials not commonly found in homes being built today. These features and materials can be very expensive, if not impossible, to duplicate. Examples include slate or tile roofs, lath & plaster walls, coved ceilings, wainscoting, solid (instead of hollow core) doors, custom ironwork, ornamented fireplaces, exposed beam ceilings, stained glass or other leaded windows, curved staircases, slate or tile floors, and other items.
Building Code Changes ?C Most older homes, and many newer homes, were built during times when building codes were less strict than they are today. If you are rebuilding or restoring your home, you may need to meet the newer and more demanding building codes. Even undamaged parts of the structure may have to be rewired or replumbed to meet current codes. Building codes may also require you to replace windows with safety glass or replace roofs with fire-retardant materials. Building code changes can add thousands of dollars to the cost of restoring a damaged home.
Construction Costs Rise After Natural Disasters ?C In the wake of a disaster affecting a wide area ?C hurricanes, wildfires, etc. ?C the costs of building materials and contractor fees nearly always rise sharply in response to the sudden surge in demand. Even without deliberate profiteering this would normally be true because when local supplies are quickly exhausted, materials have to be brought in on an emergency basis, often from mills or factories at great distance. This may require more expensive modes of transportation and a lot of overtime pay. Whenever many homes have to be repaired or rebuilt at the same time, the cost for each will be higher than normal, sometimes much higher.
Undamaged Parts Of The Home and the Contents Must Be Protected ?C Once the fire is out or the windstorm has abated, all parts of the property not destroyed must be protected from further damage or looting. This can involve covering a damaged roof, missing window glass, and holes in the walls with plastic sheeting, for example, and, as soon as possible, surviving personal property items must be removed and placed in temporary storage for safekeeping.0 -
Rebuilding is MUCH more expensive than current construction.
You're basically buying a "custom home" at that point. A one-off, one of a kind, "gotta bring everything up to code", "that type of stone isn't made any more", "do you want this upgrade?", "I can't match the countertops you used to have", "sorry, I can't put the closet there" type of house. Just the fees for inspections and permits will drive you crazy.
I don't recommend skimping on the insurance coverage. If you want to save money, I suggest increasing your deductible.
I've had USAA insure four houses for me, all my cars, jewelry, and even renter's insurance when I moved around in my Naval career.
But I'm no expert. This is just my opinion. Good luck!0
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