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which homeowner and car insurance is best
Old 03-05-2013, 08:23 AM   #1
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which homeowner and car insurance is best

I am thinking about changing my car, homeowner, and rental property insurance. I now have state farm and have been with them for 30 years. the problem is they raise my home value every year and with that the deductible increases because it is 1% of the value. they no longer cover any mold problems. I talked to other companies and they said they would cover mold if it was tied to a covered incident, such as a broken water pipe. I checked with farm bureau insurance and they have some pretty good policies and prices, but I don't know about the company. I was wondering if anyone here has any recommendations and experiences with their insurance companies that they would talk about. companies to stay away from, companies to sign with, good experiences, bad experiences. I looked at usaa but I am not military.
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Old 03-05-2013, 08:34 AM   #2
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Can't you tell them what the value of your is ? Sounds like you have a policy that adjust replacement cost for inflation. Mine was doing that as well. They use some crazy inflation index that didn't apply in my area. So I had them reset the value to something more reasonable for the cost in the area.
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Old 03-05-2013, 08:40 AM   #3
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Can't you tell them what the value of your is ? Sounds like you have a policy that adjust replacement cost for inflation. Mine was doing that as well. They use some crazy inflation index that didn't apply in my area. So I had them reset the value to something more reasonable for the cost in the area.
I did the same thing with State Farm.
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Old 03-05-2013, 08:44 AM   #4
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I did a search and found out there were other threads on this topic. If this is redundant then you can cancel it or see if there are any responses. thanks

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Old 03-05-2013, 08:48 AM   #5
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nodak. I have lived in this house for 31 years and do not know the actual value. If it burned down and I had to have it rebuilt how would you estimate that? at 150 dollars a square foot it would be 225,000 and I know its not worth that much. the taxable value is 217,000. so which number do you use?
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Old 03-05-2013, 09:05 AM   #6
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nodak. I have lived in this house for 31 years and do not know the actual value. If it burned down and I had to have it rebuilt how would you estimate that? at 150 dollars a square foot it would be 225,000 and I know its not worth that much. the taxable value is 217,000. so which number do you use?
You take the cost to rebuild the house as the basis for the insurance. In no sense do you take the current price, as the assumption is you would rebuild, versus selling out and buying another place. Quite often in down markets you find that houses have values less than their replacement costs. Also one has to be careful to ensure that the limit exceeds 80% of the replacement cost, or one might just get the depreciated value of the house. The census bureau generates an index of house construction costs, it shows for the last few years 2007 at 107, 2008 at 103.3 2009 at 98.1, 2010 at 96.4, 2011 at 97.4 and 2012 at 98.4. Note that for this index 2005 is set to 100.
Here is a link to the index: Construction Price Indexes
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Old 03-05-2013, 09:08 AM   #7
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nodak. I have lived in this house for 31 years and do not know the actual value. If it burned down and I had to have it rebuilt how would you estimate that? at 150 dollars a square foot it would be 225,000 and I know its not worth that much. the taxable value is 217,000. so which number do you use?
there exist books that provide that information, given the square footage of the house and the quality of construction. It is these books that professionals use in generating price quotes, with their own adjustments. Here is one such set of books/software (I have not used it)
2013 Craftsman Costbooks : Craftsman Book Company Construction Estimating Books and Software, Craftsman's online construction bookstore has over 150 books and programs for professional contractors, plumbers, framers, electricians, painters, estimator

You might be able to find a copy at your public library.
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Old 03-05-2013, 09:13 AM   #8
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nodak. I have lived in this house for 31 years and do not know the actual value. If it burned down and I had to have it rebuilt how would you estimate that? at 150 dollars a square foot it would be 225,000 and I know its not worth that much. the taxable value is 217,000. so which number do you use?
It's not really the "value" or resale price of the home but what it would cost to build it. That can vary a lot from what the sale would be.

Here's a building cost estimator

Building-Cost.net -- free residential building cost calculator

Also may be easier, find a local building contractor and ask for an estimate to what it would cost to build a similar new house. Or just ask what they get on sqft to build.
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Old 03-05-2013, 09:14 AM   #9
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Rate shopping should be done more often by people. I learned that lesson. My company kept jacking up my premiums by increasing value of home. I could have rebuilt my home brand new, for $50 k less than my policy was insuring me for. And they wouldn't come down a dime in value. I still don't understand why I can't choose the level of monetary value of my home. It should not effect them. I did cut my premium in half last fall by shopping around, so I guess it is a moot point for now. Oddly enough despite this companies attempt to gouge me with my home, I could not find anyone close to their auto insurance cost so I stayed with them.
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Old 03-05-2013, 12:28 PM   #10
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I agree with the rate shopping. Even though I live in a place that is hard to insure, I still hunt up new quotes every few years. State Farm had beaten the others on price for quite some time (though I really have a strong dislike for them dating back to Hurricane Hugo days), but I was delighted when a relative newcomer was able to bring my quote down.

I do the same with auto, term life (thought don't bother now that we are getting up in age), and any other insurance products. My old RV policy with Progressive turned out to be way high when I finally got around to shopping it.
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Old 03-05-2013, 12:30 PM   #11
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I fully agree with Mulligan's point of shopping around. Both homeowner's and auto policies. I would say every two-three years. I remember some years back when I was with Progressive Auto Insurance. They told me no other company could compete with their rates for retirees. Guess what. The following year I got a big rate hike-asked them why with no accidents or tickets and was told because I had reached the 75 year old benchmark. Automatic rate increase. Got shopping around on the internet and found 21st Century. Did the same with homeowners two years ago.

A word of caution on construction cost. The rebuild rate is higher than new construction cost. I can buy a new home in our general area for under $100/sq ft (maybe $90) but rebuilding what I have now on this same site might cost $130/sq ft or more. Some good sites have been provided by other posters.
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Old 03-05-2013, 01:37 PM   #12
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This site is not free, but is well regarded and for $7.95 you can get a good idea of replacement cost.

AccuCoverage® - Replacement Cost Calculator to Help Determine How Much Home Insurance You Need
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Old 03-05-2013, 02:34 PM   #13
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nodak. I have lived in this house for 31 years and do not know the actual value. If it burned down and I had to have it rebuilt how would you estimate that? at 150 dollars a square foot it would be 225,000 and I know its not worth that much. the taxable value is 217,000. so which number do you use?
I used the taxable value which was within $1000 of what I paid for it.
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Old 03-05-2013, 02:34 PM   #14
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I am not a member of AARP but found that AARP car insurance from The Hartford saved me money vs. my Geico policy, so I switched. Still have State Farm for home insurance as neither would give me a better price if I consolidated into one company.

I think cost to rebuild is often quite a bit higher than current market value but I would use the lower (market value) to determine how much to insure my house for. If it burned down buying a similar house would be replacement; buying a new house would be an upgrade.
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Old 03-05-2013, 03:44 PM   #15
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I assume you've made State Farm aware that their premiums are no longer competitive? We're with Liberty Mutual, and I didn't realize they were raised our premiums far outside competitive rates, it happened slowly over decades. When I confronted them, they basically cut our premiums almost in half, with the same coverage.

The only thing I will recommend is getting insurance quotes from equivalent competitors every year or two to keep the incumbent "honest," or switch if they don't. I'm not sure it would look good if you switched every year, but others may know better.

I learned that lesson the hard way...

Fool me once, shame on you. Fool me twice, shame on me...
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Old 03-05-2013, 06:15 PM   #16
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State Farm had my house insured at replacement value. I am not living in the house now and rent it out. I got rental property insurance for the taxable value because if anything happened to the house I would not rebuild. If the house was gone and I decided to return to that town I would rent an apartment.
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Old 03-05-2013, 06:25 PM   #17
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I think it was you Midpack that posted a couple years ago,(?), about rate creep. That made me think about mine, also. I got quotes from several companies. I stayed with State Farm since they really were competitive with the other companies. I was lucky?

The only thing I can add...is to watch those low offers. They may be low balling you to get your business and then raise it a year or so later. Be suspicious and ask if you are getting a special deal for new customers and will it go up to a higher rate later.

I can't help thinking the insurance companies are as ruthless as cable and cell phone companies...
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Old 03-06-2013, 04:25 AM   #18
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As consumers, we call it "ruthless" but really these companies are just doing what our society collectively have trained them to do. Short of harming people or doing things that will make them look worse in the media than their competitors, society has done everything it can to get businesses to think about nothing other than making as much money as they possibly can. We reap what we sow. We can choose to act as ruthless as them, and comparison shop on price alone, or we can recognize that we care about more than just the money, and comparison shop on price, service, reliability, etc. I recently switched all our insurance away from MetLife even though they were among the lowest-priced offering. Their service is good, but for various reasons, specific to my situation, I want my insurance company to provided better service.
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Old 03-06-2013, 06:19 AM   #19
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Good point BUU...business is business and as consumers we need to look after our interests since no one else will, (and that includes the govt).
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