my D’s stuff in her dorm was covered under our HO. But it was subject to our deductible, so we purchased one of those cheap college plans that had a zero deductible. (D was kinda hard on her stuff, so it worked out as we got her phone replaced (wait, you mean I shouldn’t talk on them during a rain storm?), as well as a jacket or two which she left in the lecture halls.)
1 Like
Thanks so much for that, it’s useful to know (I got an email from CC about a renter’s plan for college students, so that’s what prompted me to write).
It’s somewhat of Trojan horse (non-viral, of course) email. The real purposed of the email was to try to lock in SF as far as possible regarding homeowner’s policies. Like I said above, I’m not naive enough to think they will give a definitive, but I do intend to have a documentable paper trail on this super-serious issue.
I hadn’t fully appreciated how little we pay in CA, and perhaps the regulators have over-regulated the pricing. But surely that is not happening in other states like FL etc that are facing similar problems.
Florida’s issue is different, and the Leg amended the law effective next Jan.
If I recall from the WSJ, FL attorneys can make bank on small damage claims. For example, a storm passes by and rips off a few shingles on one part of your house. Repair that section for say, $1k. Threaten to file in court and voila, you get a complete new roof.
According to this Bankrate article, the median national home price in June 2023 was $410,200. So the average home insurance rate is about 0.59% of the median house price. (The article also gives median house prices by state…California’s is the highest at $799k.)
So, for the $1.7 million house, $10,000 is 0.59%. The $20k rate was 1.18%. My rough calculations show that I’m in a 1.25% home insurance pricing.
2 Likes
it’s still way beyond what Californians are accustomed to paying.
I think a big diffentiator in CA is the price of land. In the Bay Area, the LA are, and the SD area, I guess land is very much at a premium, along with non-urban coastal areas.
I pointed this out to to our agent, who agreed with me, that there was significant value in our land that would LIKELY not be damaged too much in a disaster (I guess earthquakes and landslide notwithstanding).
We did a recalculation on the present cost of construction to determine how much it would cost to replace the house, and I was fine with that. Backing out the land value helps a bit.
I also note that our SF agent’s staff is usually extremely quick to respond to emails, but they seem to be taking a bit of time on the email I just sent them! Who knows why, but I would like to think they are thinking long and hard about their response, which is what I want them to do. This will be the first of many written exchanges on this issue.
3 Likes
By that calculation, my (annual insurance / home value) is currently only 0.06% – 10x lower than national average. It will increase to 0.07% after my policy renews next week.
As I noted earlier in the thread, for a more accurate figure, you should consider cost of replacement, which may be very different from home value. In coastal, southern CA cost of replacement tends to be a small fraction of home value. However, in a low cost of living area, cost of replacement may far exceed home value.
It’s also important to consider things like what type of coverage you have, including size of deductible; and chance of filing a large claim. The latter depends on both personal risk of filing claim and climate risk of external damage.
2 Likes
In California the land holds the value of a house for sure, but also remember our biggest potential hazards are earthquakes, which are not covered by homeowners insurance.
No, I’m not - but I don’t have a multi-million dollar home either. Based on the average premium and average value as noted after your post I’d say I’m right at “about average” for the value of my home.
You pay $1,200 for HO and auto insurance on a 7 figure home? We all need your agent’s number.
Understand every state, insurer or agent might be different in this space but my homeowners policy states explicitly on in the “Estimated cost to replace dwelling and contents” (or some such language). So yeah - if a homeowner has an issue with that valuation they should be going back to the agent to look for an adjustment.
That does make me wonder though what happens to those folks whose dwelling falls into the water due to erosion - they clearly lose all use of the land in addition to the dwelling.
By that figure I’m at 1.08% if you use the assessed value. I’m at 0.21% if you use the insurance company’s replacement cost, but never in a million years would I rebuild a 1 million dollar house on my lot. $500K would be extreme. $300-400K would be more likely - and that would be considered super nice for my hood!
1 Like
No agent. USAA.
1 Like
I’m not sure if this has been articulated well here, but a million dollar house in Southern California is a normal tract house. Just to be clear, we’re not talking about a custom or luxury property.
5 Likes
Side Tangent: I’m eligible for USAA insurance, heard they were very good, so wanted to compare with our current Safeco policy. However, I had a terrible time getting a firm quote from USAA. Is this typical?
-
I was seeking quotes on a combination of home/auto/umbrella. I had to call back several times with additional information (or questions) on the home-owner’s portion. Each time, I spoke to a different representative, and received a different quote on my auto policy, even though it was always on the same car and driver history.
-
They would only give me an Estimated cost on our home insurance portion, which would not be ‘confirmed’ until after an in-house (on site) evaluation. I had never heard of that, but they said it was due to the age of our home (about 65 years old). I had no problem with an in-house visit, BUT, they would not schedule this visit until after I started a policy with them. HUH? That means I would need to cancel my current coverage, start with USAA, and only confirm my actual premium cost after I switched? What if the price rose for whatever reason, and I didn’t like it? Our Safeco broker confirmed I would lose our “long-time” policy holder discount, if I left and wanted to return, so we never switched.
It might be worth considering again as rates are increasing, but not if the process is the same.
yeah, their Auto, Home and Umbrella sales specialists are all different. And each Line is priced separately, with a discount for having more than one line. Surprised about Auto, since that should be easy to quote. btw: their Umbrella does require that you maintain a certain Auto limit. I guess that way the Auto kicks in first as teh Umbrella is on top of the Auto.
Been with them for a long time, so can’t help with their (new?) rules (such as in-house exam), altho I can understand why they would only want to perform such an inspection with current customers, particularly since covid.
1 Like
My daughter and son-in-law found that their State Farm policies for home and auto were cheaper than the quote from USAA.
@mynameiswhatever I would think the agent would probably not have any firm knowledge of what is to come. I’m also not sure what having it from an agent in writing will be of help down the line.
For college students the companies that insure college students are a good option. You wouldn’t want to make a claim on your homeowners for a stolen bike or broken laptop screen.
At one point I tried USAA. Maybe it was when we added older S to the car insurance. But their auto policy alone was higher than our car/auto/umbrella with Hanover. And their car price was including the discount for the homeowners.
And I love our broker agent J. We have had our cars hit several times - never our fault! I call her and she takes care of everything! And she’ll shop around when I ask her to. Love her.
My spouse had USAA before we married. But when we compared USAA to State Farm and others (at least for auto insurance), the others won. I can’t recall, but I feel as though USAA wasn’t writing policies in our area for home insurance.
He does. Remember that agents can bind their principal (State Firm). I’ll take what I can get, and he did indeed respond.
He did indicate that SF will likely start issuing new policies soon and this is just a temporary issue. They have no plans to cancel existing policies. That’s helpful to have in writing.
1 Like
FWIW, I live in WA. Two homes, one in a suburb, the other on low/medium bank waterfront. Each is valued ~$850-900K (land + home). Our current policies are full replacement ($1M+) & premiums run around $1,450/year each. We have had home and auto plus an umbrella policy since the mid-80s.
My jaw dropped reading the premiums elsewhere.
3 Likes