Insurance!!!

[Midpack]

I found out I was being ripped off by my friendly insurance provider back in 2011-12, despite 1 auto claim & ZERO homeowners claims in 30 years, that story was here http://www.early-retirement.org/forums/f27/hopefully-theres-no-one-as-dumb-as-me-here-59422.html. The only reason they didn't get booted then and there is because they gave me lower rates than any other reputable company.

Since then I have gotten new quotes every year to 'keep them honest,' but it seems I can't win anyway. My rates have gone up way more than COL every year, this year I get to pay 7% for homeowners (same house) and 13% more for auto (same cars, with another year of depreciation).



[/rant]

 

[W2R]

I'm sure my insurance rates are going to skyrocket upwards next year. Like you, I have home and car with the same company, for 14 years in my case. For the first time in those 14 years, I filed a claim on my insurance recently because I backed into a parked car last September, causing $741 in damage to the parked car (oops!) and no damage to mine.

We'll see what happens to my rates, but I have no idea because this is all new to me. My thinking was that if I can't even make a claim, what good is insurance? I am not a fan of insurance in general, although I have it because I must. Still, I am trying to keep an open mind.

 

[Amethyst]

Insurance companies exist to make money for themselves and their shareholders.

Extrapolate.

(My father's father was an insurance executive, who tried to get my dad to follow in his footsteps. Dad tried it on for size, and decided he'd rather become an electrician).

 

[marko]

I found out I was being ripped off by my friendly insurance provider back in 2011-12,

It's ok. I've been getting ripped off by insurance companies since, oh, about 1968.

 

[rodi]

When you get the quotes from other companies - are they also going up faster than COL?

I have a different insurance rant. We live near a canyon that is rated a "fire zone". So many companies won't cover us. Then we have a detached granny flat - on our lot - which is confusing for a large percentage of the remainder of companies. And we need umbrella insurance. I found exactly TWO insurance carriers that will cover us... And one is double the others. Ironically, the fire zone issue is not behind our house - it's behind the houses across the street... But our house is *just* close enough - by 5 feet.

 

[NW-Bound]

I found out I was being ripped off by my friendly insurance provider back in 2011-12,

It's ok. I've been getting ripped off by insurance companies since, oh, about 1968.

"... I was a fluff with chicks. I've been this way since 1956."

 

[Midpack]

When you get the quotes from other companies - are they also going up faster than COL?

Presumably - I haven't kept track but they've been higher than the incumbent each year. A few are competitive on auto, but the others are all significantly higher on home owners insurance - even with a package deal. Not sure what that tells me, but there doesn't seem to be good competition in home & auto insurance based on the increases I've seen year after year since 2012. Only industry I can think of that's worse is health care...

 

[ziggy29]

It's odd. I hear people say this a lot, but this has not been my experience. I do "sanity check" some quotes once in a while, but my USAA auto policy in Texas either stays about the same or goes down almost every term. In July my wife traded a 2006 Civic for a 2016 Honda HRV (like a CRV but a bit smaller), and our premium was almost unchanged even though we were insuring a ~$20K vehicle instead of a ~$8K vehicle. And when it came for renewal in November, our premium went *down* from about $580 to $530 for six months. (This is with 300/500/100 liability and an underlying $1M umbrella).

We can't speak for homeowners any more since we live in a parsonage now and just have a renters/non-owned policy covering the contents for about $11 a month.

Insurance is a funny game. What could be the worst insurer for one person can be the best for another, just because of differences in underwriting policy.

 

[Midpack]

It's odd. I hear people say this a lot, but this has not been my experience. I do "sanity check" some quotes once in a while, but my USAA auto policy in Texas either stays about the same or goes down almost every term. In July my wife traded a 2006 Civic for a 2016 Honda HRV (like a CRV but a bit smaller), and our premium was almost unchanged even though we were insuring a ~$20K vehicle instead of a ~$8K vehicle. And when it came for renewal in November, our premium went *down* from about $580 to $530 for six months. (This is with 300/500/100 liability and an underlying $1M umbrella).

We can't speak for homeowners any more since we live in a parsonage now and just have a renters/non-owned policy covering the contents for about $11 a month.

Insurance is a funny game. What could be the worst insurer for one person can be the best for another, just because of differences in underwriting policy.

Apparently true. My Dad and sis both swear by USAA, lifelong customers. I got quotes from USAA last year, auto was competitive, homeowners was not. I called and asked to be sure, but the quotes were on the correct policy terms - so they weren't competitive in my case for whatever reason. So I guess I stay with the devil I know for now...

 

[redduck]

"... I was a fluff with chicks. I've been this way since 1956."

That's interesting because I was a flop with chicks since 1956 (Searchers: Love Potion #9). Even though I rubbed on Love Potion #9 everyday, it didn't seem to help much. (Maybe I was rubbing it on in the wrong place).

 

[aja8888]

That's interesting because I was a flop with chicks since 1956 (Searchers: Love Potion #9). Even though I rubbed on Love Potion #9 everyday, it didn't seem to help much. (Maybe I was rubbing it on in the wrong place).

I was a flop with chicks until I traded in my baseball glove for a Corvette Stingray convertible.

 

[RE2Boys]

Apparently true. My Dad and sis both swear by USAA, lifelong customers. I got quotes from USAA last year, auto was competitive, homeowners was not. I called and asked to be sure, but the quotes were on the correct policy terms - so they weren't competitive in my case for whatever reason. So I guess I stay with the devil I know for now...

More difficult to compare quotes when one of the companies is USAA (a mutual insurance company). While not guaranteed, depending upon capital requirements, mutuals can rebate a portion of the premiums. Last few year USAA sent back about $800 per year, on about $2800 in premiums paid (auto/home/umbrella). Some of these credits may have been earned in earlier years as, with over 40 years with USAA, I'm eligible for senior bonus distributions.

 

[HadEnuff]

Our rates went up when after 15 years of ZERO claims, my wife was stopped at a red light, and sideswiped by a hit-and-run, who had tried to make a right turn in a hurry before the light changed. Never caught the bastard.
Obviously, we are NOT supposed to stop at red lights. I couldn't believe it.

 

[Cobra9777]

Some auto insurers do "price optimization." You can google it and read a ton, but in a nutshell, they research your buying habits (well beyond insurance) to determine your sensitivity to price changes. The less likely you are to switch products or service providers, the more likely you will get rate increases on your auto policy. When it comes to auto insurance, loyalty is generally a very bad idea. Here's a good NPR article on the topic.

Also, GEICO and Allstate announced they would be increasing premium rates earlier this year as a result of increased frequency and severity of claims. Evidently, the improving economy is to blame. Here's a quote from Allstate CEO Tom Wilson:

There are more accidents now over the last couple of years than there have been because economic activity has gone up and more people are driving. We and other people have been raising our rates to account for that.

 

[ElizabethT]

Some auto insurers do "price optimization." You can google it and read a ton, but in a nutshell, they research your buying habits (well beyond insurance) to determine your sensitivity to price changes. The less likely you are to switch products or service providers, the more likely you will get rate increases on your auto policy. When it comes to auto insurance, loyalty is generally a very bad idea. Here's a good NPR article on the topic.

Also, GEICO and Allstate announced they would be increasing premium rates earlier this year as a result of increased frequency and severity of claims. Evidently, the improving economy is to blame. Here's a quote from Allstate CEO Tom Wilson:

This made me smile. Insurance rate increases are subject to review and approval by each state's board of insurance, and must be justified/backed up with actuarial data. Insurance companies, unlike retailers, cannot simply raise prices on a whim.

 

[RAE]

You might want to check with AAA, they've been pretty fair to me over the last couple years, and the rates have been reasonably stable. Also, on another thread, I recall that a few folks have had a good experience with Progressive. I don't have any experience with Progressive, personally.

 

[pb4uski]

Wow, you are getting ripped off! Mine is a lot lower than yours!!!

If you can't find similar coverage at a better price then I fail to see how you can get mad that they are overcharging you.

We haven't had any claims either, but it is more than claims... it is risk.

FWIW, mine is slightly lower ~$750 for house and ~$1,400 for auto (new car and 9 yo truck) but the insured items may be much different.

 

[rodi]

You might want to check with AAA, they've been pretty fair to me over the last couple years, and the rates have been reasonably stable. Also, on another thread, I recall that a few folks have had a good experience with Progressive. I don't have any experience with Progressive, personally.

I had AAA for years. Never had a claim. But when I wanted an umbrella policy they dumped me - they decided they wouldn't be able to increase the landlord policy on the granny flat because of the fire zone (even though it's even further from the fire zone than our house) and since we couldn't up the limits on that policy - we wouldn't qualify for the umbrella. So much for 15 years with the same company, and 8 years of having them cover the granny flat with no problem and no mention of the firezone issue. I'm no longer a fan of AAA.

 

[mathjak107]

there are so many variables that are locality sensitive .

we saw homeowners go from 500 to 1100 in 5 years when we had the house in the pocono's yet our place here in nyc hardly went up with the same company .

 

[Options]

My umbrella/home rates were raised slightly a couple years ago despite having zero claims for many many years. So one of my many projects this past fall was to see if I could lower my umbrella/home/auto insurance costs by bundling. Currently, umbrella/home are with Pacific Specialty and auto is with Wawanesa.

I called three brokers and provided my information: two never called me back, and the third found auto rates at twice what I'm paying. One of the few benefits living in CA provides is that Wawanesa only insures in this state and only drivers with good records. I've been told repeatedly their rates can't be beat. In fact, as my annual miles driven have fallen by 2/3 as a result of retirement, they reduced my rates by almost half this year. Consequently, even with the higher umbrella/home rates, I can't improve on my current situation.

I agree it's a good idea to shop around at least every couple of years, even though in my case I've never found anything better than what I'm paying now.

 

[rdy2go]

One of the things that people don't think about when wondering why their insurance rates went up is that insurance companies also have costs that go up. Employees like cost of living raises, computers have to be replaced, fleet cars cost more and have to be replaced, etc., so they have to charge customers more to cover their increased cost of operations. Also, the parts to repair a car go up every year, home materials and labor costs go up and the value of your home's contents keep going up as far as replacement goes. Insurance companies should raise rates about 3-t% every year just to keep up with inflation. if they don't do that and only revise their rates every three or four years, then they need to get a larger increase to keep up with costs.

About a third of the cost of an insurance policy is overhead for operations and your agent's commission. The better run companies this year are making something around 5-6% profit on their underwriting and a little bit more on investments.

In reality, you want your insurance company to be profitable and you want them to have the reserves set aside to be able to pay the claims when a hurricane, tornado or huge wildfire comes along and wipes out a huge area.

I know that people love to bag on insurance companies and banks, but I remember in 1986 when banks were closing and people were in a panic when their bank closed. It was fun to watch a bank close until it was your bank. I want my insurance company to have enough money to be able to pay my claims and not be wondering if they have enough to stay in business.

 

[Texas Proud]

My auto insurance went up big time.... partly because of a teen boy and partly because of claims..... but it went up 4X!!!!

I calculated the total cost of all insurance for me and it is now topping $20K.... the biggest being health....


Edit to add... when I called and got a quote for my 'high' auto, they wanted an extra $1k per year...

 

[Mulligan]

My auto insurance went up big time.... partly because of a teen boy and partly because of claims..... but it went up 4X!!!!

I calculated the total cost of all insurance for me and it is now topping $20K.... the biggest being health....


Edit to add... when I called and got a quote for my 'high' auto, they wanted an extra $1k per year...

I would hate to add up all the money and its opportunity cost lost to insurance over the past 35 years. When I was young and dumb and low income, I always had a nice car and nice insurance premium to go with it. Now, that I am older, I could care less about a new car. I cant stand giving money away on sales tax, property tax, and insurance. Its older cars (that look new, as I buy from old people) and liability for me....


Sent from my iPad using Tapatalk

 

[Midpack]

I would hate to add up all the money and its opportunity cost lost to insurance over the past 35 years. When I was young and dumb and low income, I always had a nice car and nice insurance premium to go with it. Now, that I am older, I could care less about a new car. I cant stand giving money away on sales tax, property tax, and insurance. Its older cars (that look new, as I buy from old people) and liability for me...

No argument, but at least with sales & property taxes you are getting something in return. With home, renters & auto insurance, we've gotten absolutely nothing in return on our home or boats, and one claim on auto in 39 years!

 

[rdy2go]

No argument, but at least with sales & property taxes you are getting something in return. With insurance, we've gotten absolutely nothing in return on our home or boats, and one claim on auto in 39 years!

Talk about a ripoff, I've been paying for life insurance for over thirty years and I haven't even died yet!