Homeowners' Insurance- 2 Questions

[petsetc]

I know insurance is an ongoing conversation here, but I do have two specific questions that I would appreciate input on if anyone can help

Background: I recently received my homeowners’ renewal due in March from Tower Hill Insurance (policy written by TV Insurance). My premium went from $857 to $1,051, a 22.6% increase. No claims, nothing has changed. I will contact TV agent shortly and shop.

I understand some of it is increased value (which is a bit ridiculous since the insurer should be using sf construction cost, not home value).

Question 1: Has anyone else with Tower (or others) experienced a similar increase recently.

Question 2: I am a seasonal resident and when I purchased new in 2015, I tried to get coverage through USAA. After the long half hour of detail, they told me they were not currently writing second home policies in TV zip code. And yes I did ask up front and still has to go through the whole drill to get an answer.

Have any other seasonal/second homers gotten a NEW homeowners policy through USAA very recently?

As always, thank you for your consideration!

[Tom359]

I am an agent for one of the largest insurance companies in America. Your premiums pay the claims for every other person, so when more people report claims, your rates will increase. I get this question all the time..."I've not had any claims, so why are my rates going up?" Insurance companies are a business, and they expect to make a profit. When claims increase, rates do as well to cover that. I know most people think "those greedy insurance companies are raising my rates so their profits go up", but the reality is that in insurance, the profit margin is usually 1-3%, so you are not being gouged. However, when you see the ads saying "we can get you a free roof", what they are saying is that we will get your insurance company to pay for the roof which means 1) you now have a claim against your record which will affect your rates and 2) since more claims are being paid, rates for everyone will also increase. it's a vicious cycle, nothing is "free".

[John_W]

I switched homeowners insurance in 2018. After purchasing a new masonry CYV in 2011, I contacted Villages Insurance, they have offices at all three squares. I went with American Integrity, I tried to get ASI (Progressive) because of the good reviews, but they wouldn't include sink hole. Initially my premiums were $505 with American Integrity.

In 2018 my bill was $985 and had never had a claim. When I checked my records, they had increased the premiums 5 times in 8 years. I had dropped USAA car insurance that same year since they had raised my premiums $120 a year when I traded in a $40,000 car for a $24,000 car. When I called them, they couldn't explain why. I went with AAA car insurance since my neighbor had them, and liked their services. When I called AAA they charged less than USAA had been charging me originally and since starting with them, they've gone done another $40 every six months. I contacted AAA about the homeowners and they were only $20 a year cheaper than American Integrity.

I then contacted my Villages Insurance Agent and said I to switch homeowners, in addition to the increases there has been numerous complaints on TOTV about them not paying claims. She checked with ASI and they were still not including sink hole. After discussing a few more names, we went with Coastal Cabrillo out of Gainesville, Florida. they were only $565, over $400 cheaper than American Integrity. My second year they went up to $619, a slight increase but not bad. The only contact I had was they sent a photographer in the beginning to photo the outside of the home.

Cabrillo Coastal General Insurance Agency – Residential property insurance for hurricane-exposed areas. (https://www.cabgen.com/)

[CoachKandSportsguy]

Insurance companies are a business with a profit motive, they have two hurdles which they have to figure out to be successful:
1. Cost of acquiring a new customer
2. How to increase the profitability of classes of customers.

So, first cost is advertisement / sales offices, the second cost is selling a lower than competitors introductory first year cost.

How to increase profitability is the look as different classifications of customers and using stickiness calculations, increase prices where they calculate they will stick. The economics term is price sensitive or elasticity.

So based upon activities happening in your customer classification, which you will never find out as its a predicative analytics classification, prices are increased at different rates.

So, the best choice is to always compare pricing but the algorithms know that a two digit difference starts to cause customers to react. . . we have progressive (ASI) and have no idea if the cost is a good value or not, as the investment property has commercial insurance coverage.

marketing guy

[Bilyclub]

My State Farm policy went up $150. They upped my coverage due to the cost of building materials which has increased tremendously since the covid started. Coastal Key (Allstate) is $200 cheaper with lower coverage. Both policies have sinkhole coverage.

[petsetc]

Thank you all who offered info including one by PM.

My TV agent offered the following interesting read.

Get ready for massive home insurance price hikes - South Florida Sun-Sentinel (https://www.sun-sentinel.com/business/money/fl-bz-south-florida-insurance-market-in-crisis-to-spur-big-rate-hikes-20201010-p4nyldtmyzgz5najziahot7ev4-story.html)

If you want to read the links and not subscribe, I found clearing cookies and cache allowed addition access.