Homeowner's insurance buying decision - price vs reputation

[swaneesr]

Quote:

Originally Posted by Scuba What is the easiest/best way to get competitive quotes and to make sure the quotes are for comparable coverage/deductibles/etc.?

Easiest way is to start online. Pull your old policy details and fill out the information to get online quotes. I think you will be surprised at the ease of getting an online quote. Last time I did this I actually ended up calling and working with an agent online.

Local independent agents you can start on the phone. However, it is best to make an appointment and bring all your current policy documents.

At least this is my plan for later this year.

Swanee

[athena53]

Quote:

Originally Posted by meierlde Assuming your current limits are more or less up to date, you could then ask for the same limits adjusted for their inflation adjustments for the year from each. Find your current policy and note its limits. If they have not been adjusted recently they the best bet would be to discuss the issue with each agent. Ask for the quote to include the limits. Also decide if its time to increase deductibles on both the auto and home damages section.

Be careful about this part. I got a competing quote 2 years after DH and I bought the house and the market was fairly stagnant, so got the quote for the same policy limit. The premium was lower so I went with the new company. THEN they did a drive-by evaluation of the house and upped the limit by at least 20%- I forget the actual number- and the "savings" disappeared. It was Replacement coverage (what it would cost to rebuild the whole thing in case of a total loss), so hard to compare with market value and thus hard to refute. Make sure they're not planning to see if the limits need adjusting AFTER the policy is effective.

[meierlde]

Quote:

Originally Posted by athena53 Be careful about this part. I got a competing quote 2 years after DH and I bought the house and the market was fairly stagnant, so got the quote for the same policy limit. The premium was lower so I went with the new company. THEN they did a drive-by evaluation of the house and upped the limit by at least 20%- I forget the actual number- and the "savings" disappeared. It was Replacement coverage (what it would cost to rebuild the whole thing in case of a total loss), so hard to compare with market value and thus hard to refute. Make sure they're not planning to see if the limits need adjusting AFTER the policy is effective.

One other comment you might ask for a copy of the policy form, i.e. the thick document not the declarations page. Then read it to see in detail what is and is not covered. I agree the issue is the cost to replace not he market value which can be significantly lower.

[athena53]

Quote:

Originally Posted by meierlde One other comment you might ask for a copy of the policy form, i.e. the thick document not the declarations page. Then read it to see in detail what is and is not covered.

One very interesting article I read in the CPCU journal years ago discussed the differences in Auto policies. Most of the major companies use standard forms issued by ISO (Insurance Services Office) so they provide the same coverage, but some of the highly-discounted companies shave off bits of coverage here and there. An example was liability coverage for a rental car; I believe the standard forms still cover if you rent a car, then let your friend drive it and the friend gives the keys to another friend who gets in an accident. The discounted policy did not. I'm sure the same differences exist among Homeowners policies.

A good agent should be able to tell you about the differences, but they're becoming an endangered species. Companies are slicing commissions down to the bone to be competitive with on-line issuers. My agent just let one person on his staff go and his house is on the market because he and his wife are downsizing to cut costs.

[akck]

Quote:

Originally Posted by Scuba We too have Allstate and have been with them for many years (15-20). The agent we deal with has a bricks & mortar location in our neighborhood, and we can actually talk directly with him when questions or issues come up. However, premiums have increased in particular on our homeowners so I am considering doing a competitive bid on the bundle (homeowners, auto, umbrella) to see whether our pricing is in line or not with competitive offerings. What is the easiest/best way to get competitive quotes and to make sure the quotes are for comparable coverage/deductibles/etc.?

After Allstate sent me their policy renewal with another significant increase, I used the document and got online quotes with State Farm, Geico and Progressive. Two were significantly below Allstate’s cost. I was about to go with State Farm, but decided to give my independent agent a shot at a new quote. I assume they checked with the other companies they represent and one was lower than the State Farm quote for combined auto and HO. I stayed with my independent agent and my current policies have not gone up significantly and even went down a couple of years.

[Scuba]

Very informative answers, thank you!

[calico1597]

Does anyone here use Ameriprise home insurance thru Costco? My cousin bought a home a couple blocks from our winter home. They paid twice what we paid for our house, but their home insurance with Ameriprise is half what we pay with Allstate. I'm not a Costco member, could that be the cause of the difference? Any recommendations for Ameriprise?

[COcheesehead]

Take the lower rates. Insurance is one the industries where loyalty is penalized not rewarded. Shop it every year through a broker and move at will.

[Sojourner]

Quote:

Originally Posted by COcheesehead Take the lower rates. Insurance is one the industries where loyalty is penalized not rewarded. Shop it every year through a broker and move at will.

This is what I ended up doing. The quote I got from esurance (an Allstate company) was too good to pass up. I did the whole process online, from getting the quote to signing up and paying the premium. Next year I expect to have to shop around again, because I got a couple hundred bucks in discounts and sign-up incentives for being a new customer and other one-time-only things. Have to play the same game every year or two with satellite/cable TV providers, ISPs, and natural gas companies, so it's nothing new for me.

[brett]

I read a study a year ago or so that was done in the UK. The purpose was to review insurance premiums.

In a nutshell the findings were that insurer's in that country regularly hiked home an auto insurance rates. The longer you were a customer the more you paid after a few years. This was done to subsidize rates for 'new capture' customers.

The study look at home and auto policies that had been in place for five or more years. They then went out and contacted the same insurance companies with the identical properties/automobiles. The differences between the new customer premium offer and the existing customer rate was as high as 30 percent in many instances. Sometimes higher.

The conclusion was if your rates are going up higher than the rate of inflation in each of the first two years then shop your policies to confirm their competitiveness. We did this with our auto policies and realized a substantial reduction in the premium cost from our existing carrier. Went out for home insurance and found a huge difference in premiums. We went with an insurer who had the best claims reputation in an area near us hit by a natural disaster. They were not the lowest but very close to it.

It pays to shop.