Suzy Orman Ditches HO Insurance (don't do this at home)

Gotadimple

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From Yahoo Finance
Suzy Orman ditches her homeowner insurance on her Florida condo. It's in Florida, on the beach. Don't do what Suzy does.

But here's the key quote:
"Luckily, I have the money to self-insure." As she's said before, she's a "very, very wealthy woman" but doesn't like wasting money on certain things.
 
She has a quote for $28k to insure a 2100 sf condo, so there’s more to this story than appears in the linked article.

There have been articles in the local South Fl news that Citizens is transferring (depopulating) over 100 k policies to new insurers who are charging substantially higher prices. Looks like the much touted home insurance reforms of the past 2 years haven’t accomplished much.
 
She has a quote for $28k to insure a 2100 sf condo, so there’s more to this story than appears in the linked article.
Sure, I get it. But I'm trying to wrap my head around an admittedly "very, very wealthy woman" and a 2100 sqft condo. Sad, IMO
 
My question would be what is she insuring? My mom's condo was insured by the condo itself.... it was part of your monthly fee.... you HAD to buy liability insurance but did not have to buy insurance to cover your belongings...

I would be really surprised that a single owner would have to insure their part of a whole condo...
 
My question would be what is she insuring? My mom's condo was insured by the condo itself.... it was part of your monthly fee.... you HAD to buy liability insurance but did not have to buy insurance to cover your belongings...

I would be really surprised that a single owner would have to insure their part of a whole condo...
This is exactly what I wondered! I'm also super curious about a $28K quote for a condo owner's policy. Maybe because she's "very, very wealthy" she has very, very expensive things? We live in a townhouse on the opposite coast that's roughly the same size as hers and our insurance is ~2.5% of that amount.

The HOA's policy that covers all four units in two buildings is less than $10K/yr including an earthquake rider, so $28K is pretty mind boggling.
 
Maybe because she's "very, very wealthy" she has very, very expensive things?
She says that she refuses to eat out in a restaurant because it's "a waste of money". I'd find it hard to believe that she has very expensive things.

She seems to know the "cost of everything and the value of nothing" as Oscar once said.
 
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There are certainly more details that are left out, which the replies here have picked up on.

Considering her audience, it's not a good message to give to them, that it is ok for you to self-insure. I really do not like the term "self-insure" at all. The correct phrase is I AM UNINSURED.
 
So let’s say her 2 million dollar condo floods next year and needs 1 million in repairs. Who’s the idiot now?
 
So let’s say her 2 million dollar condo floods next year and needs 1 million in repairs. Who’s the idiot now?
Most of it would be covered by the HOA's master policy on the property...which is paid for in her monthly HOA dues.

If she would have her own condo policy, it would cover the value of damaged/destroyed personal property/belongings/contents...similar to a renters policy.
 
Sure, I get it. But I'm trying to wrap my head around an admittedly "very, very wealthy woman" and a 2100 sqft condo. Sad, IMO
There are many high end condos that are in the multi millions for that square footage, or far less. I recently stayed at a hotel in Bal Harbor that had residences, and looked them up out of curiosity. 1300SF places started at about 3-5m, and 2100 would have been about 9-12.

If you want big fancy newer stylish oceanfront places that are 5k sf you can easily be paying 20m in miami.

Very nice homes, especially considering this would not be her primary residence.
 
So let’s say her 2 million dollar condo floods next year and needs 1 million in repairs. Who’s the idiot now?
If the insurer refuses to cover it then I'd say the people who paid premiums are. I have two friends who are still fighting with their insurers for flooding due to hurricane Ian 2 years ago. They're unlikely to see a penny. I know others with Florida properties that decided to self-insure after seeing how companies have weaseled out of paying claims in the past several hurricanes. It's not irrational to refuse to pay for non-existent coverage.
 
Just an FYI, most (if not all) insurance does NOT cover flooding... ie, rising water... so I can see where they do not want to pay for damages..
 
Sure, I get it. But I'm trying to wrap my head around an admittedly "very, very wealthy woman" and a 2100 sqft condo. Sad, IMO
I’m not tracking. Is it sad that her condo is so “small” when she could obviously buy something larger? That doesn’t make much sense to me. “Larger” does not automatically mean “better”.
 
Looks like the much touted home insurance reforms of the past 2 years haven’t accomplished much.
It's amazing how quickly companies can find ways around the best laid plans of gummint. I've mentioned that our insurance industry in Hawaii has essentially put the state on notice that they will just pull out if they're not allowed to raise rates to recoup their losses due to the Lahaina Maui fires. Let's fact it, insurance companies don't go into business to help their covered clients. They go into business to make money (go figure!)
 
But I'm trying to wrap my head around an admittedly "very, very wealthy woman" and a 2100 sqft condo. Sad, IMO

This will expose my peon status, but why would 2100 sq ft be sad? I googled and she is 73 yrs old. I'm only 68 yrs old and with less than 1000 sq ft, and already if I want something from the kitchen at night I feel reluctant to "walk all the way to the kitchen". I wouldn't be surprised if by 73 yrs I put a coffee pot in my bedroom.
 
There are many high end condos that are in the multi millions for that square footage, or far less. I recently stayed at a hotel in Bal Harbor that had residences, and looked them up out of curiosity. 1300SF places started at about 3-5m, and 2100 would have been about 9-12.

If you want big fancy newer stylish oceanfront places that are 5k sf you can easily be paying 20m in miami.

Very nice homes, especially considering this would not be her primary residence.
As she's worth about $75MM, I certainly hope that her 2100 sf condo is worth several million. But she's so notoriously cheap, she won't even eat out in a restaurant, so it wouldn't surprise me to see her in a $700K condo. (I've also seen her boat...not impressive for someone with $75MM).

I just have very little tolerance over very wealthy but needlessly cheap people, my grandfather having been one of them. He was almost as wealthy as Suzy is but lived like a pauper....would park his huge Cadillac around the corner and walk into the Salvation Army for free food.

DWs best friend since childhood is worth about $5M with another $5M coming when her elderly mother passes. She lives in a tiny attic apartment (you can only stand up in the middle of the room) and spends all day watching a 15 inch TV. Worse, she gives us crap about having spent $700 each on a couple of big screens.

LBYM is fine. Depriving yourself when you don't have to isn’t any way to live.

Maybe it’s me. YMMV.
 
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Why on earth would anyone care about, let alone criticize, the size of Ms. Orman's condo or whether she self insures:confused:?

From our perspective it is entirely her own business.
 
Why on earth would anyone care about, let alone criticize, the size of Ms. Orman's condo or whether she self insures:confused:?

From our perspective it is entirely her own business.
+1

As the Temptations sang, "Don't Let The Joneses Get You Down" :)
 
Didn't Charlie Munger (Warren Buffet's long-time business partner) say the same thing a long time ago? That he and Warren don't ever buy insurance for things they can easily afford to replace/rebuild, like their homes? If she's actually worth $75MM, she has absolutely no need for HO insurance. Seems obvious to me... but I've never been impressed with much of anything that "Suze" has said about personal finance.
 
Why on earth would anyone care about, let alone criticize, the size of Ms. Orman's condo or whether she self insures:confused:?

From our perspective it is entirely her own business.
Ok ok ok! My bad!! Sheesh!
 
For argument's sake, let's say she's worth $75M, and spends 4% a year. That's $3M. If she lives as frugally as everyone here says she does, paying out $1M to fix up a storm-damaged condo would be a drop in the bucket. At that level of wealth, I'd be tempted to self-insure, except for an umbrella policy.
 
My mega-corp "self insured" on a LOT of things, even their employee health care plans (at one time). Nothing wrong with that if you can afford the risk.

This thread bothers me a bit - none of us should be telling others about how they should or should not be spending their money, assuming they are adults capable of their own thinking (i.e. no dimensia etc.)

If I could get a liability umbrella policy that didn't require insuring various things (e.g. carrying a regular home owners policy) I would seriously consider it. Even worse, my insurance company (I won't name them here) tells me I can't insure my home for less than their estimated replacement cost, even though it is fully paid off and there is no way rebuilding the home would cost that amount. (I should simply be able to do a stated value policy as long as it is at or under their estimated replacement cost.)
 
If I could get a liability umbrella policy that didn't require insuring various things (e.g. carrying a regular home owners policy) I would seriously consider it. Even worse, my insurance company (I won't name them here) tells me I can't insure my home for less than their estimated replacement cost, even though it is fully paid off and there is no way rebuilding the home would cost that amount. (I should simply be able to do a stated value policy as long as it is at or under their estimated replacement cost.)
ICAM. I've always thought it ridiculous that insurance companies won't let you choose the exact amount or percentage of the house (or property, etc.) that you want to be reimbursed for if a disaster occurred. Why shouldn't I be able to specify that I only want to pay a premium that covers 80% of the costs of a full rebuild? Or even totally forego that part of the premium that covers a full rebuild and only pay for covering the contents inside the house, if I wanted to do it that way?
 
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