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Homeowners insurance cost is going up 32.12% (Allstate in CA)
Old 06-18-2017, 11:15 AM   #1
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Homeowners insurance cost is going up 32.12% (Allstate in CA)

I have been with Allstate for about 29 years now. I received a bill yesterday for 2017, the premium is up 32.12%. I have not compared the policy to my 2016 yet but 32.12% is a bit much?

My 2016 premium was 7% higher than 2015. I wonder if this is just for California, I believe Allstate no longer issue new policy in CA.

Will call my agent Monday to find out why.

MP
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Old 06-18-2017, 12:36 PM   #2
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That's too bad. Sounds like it's time to shop some new insurance.

We found AllState to be one of the higher priced insurers, and never chose them for house or car. You might try an agency that can put both car and house policies together. You will get discounts for doing so.
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Old 06-18-2017, 12:38 PM   #3
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Obviously, an increase of that size is unwarranted. Allstate may be trying to reduce their property exposure in California or even in certain parts of the state that they deem to be unprofitable. By raising the rates by a huge amount they will run off a bunch of business and if people are crazy enough to stay they get a huge rate for the risk.

I have seen State Farm do this in Texas years ago when they decided that they had too much business in the state. They raised rates a bunch and would not let agents write much new business. If they lost a policy they could write another but it had to be very desirable business. If it was a marginal risk, they would decline to write it. By doing this, they ran off the less desirable risks and only wrote the better quality risks, hence improving their book of business.
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Old 06-18-2017, 01:09 PM   #4
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AAA also up my home insurance rate.
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Old 06-18-2017, 01:12 PM   #5
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Originally Posted by Disappointed View Post
I have been with Allstate for about 29 years now. I received a bill yesterday for 2017, the premium is up 32.12%. I have not compared the policy to my 2016 yet but 32.12% is a bit much?

My 2016 premium was 7% higher than 2015. I wonder if this is just for California, I believe Allstate no longer issue new policy in CA.

Will call my agent Monday to find out why.

MP
Keep us posted. My hurricane deductible is crazy. its not part of the $1000 deductible. It has its own 2 % value of house deductible. My mother before she sold her house had a 5 % hurricane deductible, can you imagine a $50,000 deductible by a 86 year old widow that has no money except her house??
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Old 06-18-2017, 01:13 PM   #6
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My USAA in Colorado was 30% increase.
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Old 06-18-2017, 01:19 PM   #7
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USAA Texas, up about 7%, however, the replacement value of the home has also gone up. All in all not bad.
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Old 06-18-2017, 01:32 PM   #8
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I have Farmers insurance, live in CA, and our insurance (just renewed) went up 7%.

Our is already high because we're within 1000 feet of the edge of a deep, undeveloped, finger canyon which puts us in the "fire zone". The canyon is behind the houses that are across the street from us... and we have our house and landscaping fire hardened...

We had our former insurer (AAA) use every excuse to cancel our insurance after many years of covering us... all because of this canyon. (Which wasn't a new canyon... they'd just changed their underwriting policies and were dumping any houses in the fire zone.) In the end they refused to issue an umbrella policy because the granny flat (which they'd covered for 8 years) was too close to the fire zone... even though it is further than our primary home and technically more than 1000 feet away from the canyon.... They were successful in getting rid of us. Farmers was happy for the business.

I suspect that Allstate is just trying to dump you (and your market) using whatever means are legal.
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Old 06-18-2017, 01:58 PM   #9
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I saved about 15% this year on insurance this year in FL. Agent actually contacted us with revised quotes from our ins company. Got a refund check in less than two weeks. I feel your pain with higher rates... FL home owners know it well.
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Old 06-18-2017, 02:04 PM   #10
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Obviously, an increase of that size is unwarranted. Allstate may be trying to reduce their property exposure in California or even in certain parts of the state that they deem to be unprofitable. By raising the rates by a huge amount they will run off a bunch of business and if people are crazy enough to stay they get a huge rate for the risk.
All homeowners' insurance rates (as well as other rates) must be approved by the Insurance Commissioner in each state and backed up by statistics. I can tell you from personal experience that even then they'll pick apart your analysis, pointing out only the things that may have overstated the rate and nothing that night have underestimated it. It is NOT automatic and "we want to raise the premiums high enough to get rid of this business" is not a basis for getting rates approved.

Could they have built in an increased brush fire risk given recent history?
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Old 06-18-2017, 02:05 PM   #11
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Quote:
Originally Posted by Disappointed View Post
I have been with Allstate for about 29 years now. I received a bill yesterday for 2017, the premium is up 32.12%. I have not compared the policy to my 2016 yet but 32.12% is a bit much?

My 2016 premium was 7% higher than 2015. I wonder if this is just for California, I believe Allstate no longer issue new policy in CA.

Will call my agent Monday to find out why.

MP
I dropped Allstate this year for the same reason, 75% increase over three years, am with an Independent Agent now who wrote Hanover, added $1 million umbrella and saved $1000 vs. what Allstate was raising me.
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Old 06-18-2017, 02:15 PM   #12
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Mine went up about 5% this year (USAA, Kentucky).

But my car insurance went up much more. This is one of those "difficult" states for car insurance.
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Old 06-18-2017, 03:46 PM   #13
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All homeowners' insurance rates (as well as other rates) must be approved by the Insurance Commissioner in each state and backed up by statistics. I can tell you from personal experience that even then they'll pick apart your analysis, pointing out only the things that may have overstated the rate and nothing that night have underestimated it. It is NOT automatic and "we want to raise the premiums high enough to get rid of this business" is not a basis for getting rates approved.

Could they have built in an increased brush fire risk given recent history?
You are certainly correct about insurance commissioner approval and I would also guess that the large increases in certain states are due to wildfire concerns. The same goes for Colorado, where wildfire concern is increasing with companies that have written there for many years.

Texas is bad about requiring reams of data that appears to be more to justify the insurance department staff than to justify the rates. Years ago, when I was working in New Mexico they did not even keep copies of rate filings in the insurance department. They told me that they didn't have enough storage space so they just tossed them.
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Old 06-18-2017, 04:58 PM   #14
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My bill just came. Replacement cost is up significantly but the premium decreased $36 to $972. And that's in the expensive Bay Area. Maybe as we get closer to The Next Big One, State Farm figures they are less likely to have to pay a fire claim and reduced the premium accordingly. Hmmmm...maybe I should reconsider and add earthquake insurance...
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Old 06-18-2017, 05:38 PM   #15
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Can't believe they are trying to get rid of us, we have homeowners, earthquake, auto, and umbrella with them. Auto went up a lot last year, this year it is homeowners, may be umbrella next year?
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Old 06-18-2017, 08:05 PM   #16
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If you live in a high hazard area - hurricanes, earthquakes, tornadoes, floods, forest fires, etc - you should foot the bill thru insurance rather than "the government" providing disaster relief. Unfair to the rest imo. If the insurance bill increased 75%, perhaps the payouts recently have been too great to be covered under previous rates. Moving is another option.
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Old 06-18-2017, 08:28 PM   #17
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Can't believe they are trying to get rid of us, we have homeowners, earthquake, auto, and umbrella with them. Auto went up a lot last year, this year it is homeowners, may be umbrella next year?
I think one needs to competitively shop every few years. They take advantage of inertia and charge you as much as they can, without you leaving.
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Old 06-18-2017, 11:56 PM   #18
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Allstate returned to CA in 2016 for new policies Allstate Returns to California Homeowners Market With 12.6 Percent Reduction

Been with them for over 30 years on Homeowners and 20 for Auto.

What I have noticed in the last 2 years is scrutiny on everything with extra premium $ .

Starting 2 years ago, my umbrella policy now has a surcharge for vehicles. The same vehicles already insured by Allstate.

The house is over 70 years old, so changing to another carrier is iffy. Auto club will only insure for homeowners if the house is under 20 or if all plumbing, heating and electrical systems have been completely replaced within 20 years on older houses.

That leaves Farmers, state farm, and progressive as the majors.
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Old 06-19-2017, 09:05 AM   #19
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OK, just got my renewal from USAA , there was a phone number to call as they would redo the value of my home. They reduced my premium by 131 dollars. Umbrella included.
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Old 06-19-2017, 11:14 AM   #20
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One caveat to those of you who shop around- be careful that you're aware of any differences in coverage. In the old days, most insurers used standard coverage forms developed by Insurance Services Office (ISO) so if you went from Company A to Company B and your deductibles and limits didn't change, you knew that the same things were covered.

A few years ago, I read an article in a CPCU (Chartered Property and Casualty Underwriter) newsletter pointing out that the cheaper insurers were chiseling away at little bits of coverage, that typically no one would notice- until they filed a claim. They cited a case where Person A was the policyholder, they rented a car, they let Person B (who apparently had no insurance or insufficient insurance) drive it. Person B caused an accident. The plaintiff went after Person A, who was not covered because the policy didn't extend to rental cars the insured loaned out to someone. The ISO form would have protected Person A. If it's Homeowners coverage, they may be quoting a policy which gives you only the depreciated value for your roof rather than replacement value. You may not care, but at the very least you need to know if you're getting a lower quote because you have less coverage rather than because the previous company was gouging you.

One other example: I got a lower quote for Homeowners coverage so I switched. They then did a re-appraisal of the replacement value of the home, came up with an insane number, and increased my premium- to what I'd been paying the previous insurer.

I'm a retired property-casualty actuary and I still prefer to work with an agent who knows what he/she is doing.
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