Homeowners Insurance

[BankerCat12]

Just curious if there is anyone on here selling insurance. Being on the banking side, I see quotes everyday and its crazy how fast the premiums are rising. I still see some premiums at levels for the past few years but some are twice as much as they used to be.

My biggest question is how can some companies like State Farm say they are no longer going to write insurance in Florida? That is red lining and not allowed in lending so not sure how insurance companies can get away with it.

 

[Dore95]

Redlining is refusing to insure because of race/national origin. Insurance companies want to stay out of Florida (or at least parts of Florida) because of the risk involved (hurricanes). That is not illegal.

 

[DSmith21]

California has some laws on the books that are causing insurance companies to flee. Companies have a right to decide where they want to sell their products. It's not just happening in FL or other high risk states (weather related).

I just got my homeowners renewal from Safeco /Liberty and they want a 35% increase in premium. I have never made a claim and Kentucky isn't a top risk state. Needless to say that I am shopping for a new carrier.

 

[CAT Scratch FVR]

Costs for materials to rebuild have risen, costs to auto body work have risen, inflation baby.
Companies in Florida and California have pulled back from writing any new business and non-renewing others,
You can exclude wildfire, flood, etc but if you can't predict how courts will rule in liability cases you'll never get enough premium to cover losses.

 

[GJNorman]

Climate change is real!

 

[CastleRubric]

Been thinking about this lately & its not a topic I know much about

We learned that our home owners insurance wasn't going to be renewed - because of the evaluation of an underwriter

That means someone within the previously active insurance company somehow assessed that it was too risky for them to continue supporting right?

I haven't seen details on what criteria they used but will be asking

Our winchester home IS older but previous occupants upgraded and modernized several aspects & and there's never been a claim made by us

Question about insurance companies - is it possible that they're being financially stressed more in the last 5-6 years - and maybe that's driving stricter criteria for maintaining policies?

I don't know the industry well enough to form the question any better but would love to chat it up later with anyone here who works in that world

Its going to be interesting to see how requirements for home ownership may change in places like FL etc

 

[CAT Scratch FVR]

There's more data available now than ever before. Drones/satellite footage also helps assess areas, conditions of properties, etc. They can tell if a roof needs replaced, is the property kept up, etc.
Wind/hail damage has picked up in states you never used to see.
Some carriers find out they are oversaturated in a specific region, not enough spread of risk, so they stop issuing new business.
Reinsurance rates are rising, putting pressure on the primary carrier pricing.
Pretty simple stuff too, like construction type, will your house burn to the ground quickly? How far away are you from the fire station, water sources, etc.

 

[B.B.d.K.]

Question about insurance companies - is it possible that they're being financially stressed more in the last 5-6 years - and maybe that's driving stricter criteria for maintaining policies?

Is it possible? It's fact. Speaking in KY, the widespread March '23 wind event alone was the biggest loss (700M) in my company's 100 year history...and that's not even counting the seemingly endless tornados, floods, and other events during the last 3 years.

Been a historic nightmare of a 3 year span for Insurers in a lot of places, not just the coast.

 

[CastleRubric]

Is it possible? It's fact. Speaking in KY, the widespread March '23 wind event alone was the biggest loss (700M) in my company's 100 year history...and that's not even counting the seemingly endless tornados, floods, and other events during the last 3 years.

Been a historic nightmare of a 3 year span for Insurers in a lot of places, not just the coast.

Holy shit - thats the kind of info i was hoping for

So within the insurance industry - I would assume there are different levels of capacity within the companies - like maybe local agencies vs larger corporations -

Are the smaller entities getting bought out or merged ?

Are there bailouts from the USG in any situations if certain insurers start drifting into bankruptcy?

Home and health / life insurance are normally separate business lines right?

So it sounds like there's more stress on these companies than they've experienced in a while -

What happens if enough insurers go broke or revoke services to homeowners -en masse - thats what im wondering

Plus the letters we we're getting - kicked off my natural, highly tuned paranoia

 

[CastleRubric]

Very helpful and timely thread yall - genuinely appreciate the responses

Weird but wonderful that these questions have been bugging me intensely lately & and here we are

 

[Cold Stout Beer]

Just curious if there is anyone on here selling insurance. Being on the banking side, I see quotes everyday and its crazy how fast the premiums are rising. I still see some premiums at levels for the past few years but some are twice as much as they used to be.

My biggest question is how can some companies like State Farm say they are no longer going to write insurance in Florida? That is red lining and not allowed in lending so not sure how insurance companies can get away with it.

I've got State Farm for home and auto and it's skyrockted. I asked my agent why since I never claim anything. She said "look at it this way, we're all in this together and when we have a lot of claims, we have to raise prices for everyone since we're all in the same bucket."

I said "so are illegals having lots of car wrecks?"

I never got a response back.

 

[Cold Stout Beer]

Holy shit - thats the kind of info i was hoping for

So within the insurance industry - I would assume there are different levels of capacity within the companies - like maybe local agencies vs larger corporations -

Are the smaller entities getting bought out or merged ?

Are there bailouts from the USG in any situations if certain insurers start drifting into bankruptcy?

Home and health / life insurance are normally separate business lines right?

So it sounds like there's more stress on these companies than they've experienced in a while -

What happens if enough insurers go broke or revoke services to homeowners -en masse - thats what im wondering

Plus the letters we we're getting - kicked off my natural, highly tuned paranoia

My agent at state farm said they've taken a net loss every year recently.

 

[ukalumni00]

One major issue is the large number of folks moving to FL and coastal areas. Anytime these storms hit the financial impact is much greater to these carriers than in the past. Skyrocketing reinsurance costs, etc. Fraud is incredible along with an enormous amount of injury attorneys suing for ridiculous amounts and liberal courts handing out insane rulings/financial awards to claimants. The whole system is as strained as it has ever been and then add in inflation, construction costs, etc that has skyrocketed as well.

 

[Pelosigalore]

I think that when claims go up, it makes sense that everyone has an increase. On the other hand, whoever has the claim should have the largest increase.

 

[AIChatGPT]

I've got State Farm for home and auto and it's skyrockted. I asked my agent why since I never claim anything. She said "look at it this way, we're all in this together and when we have a lot of claims, we have to raise prices for everyone since we're all in the same bucket."

I said "so are illegals having lots of car wrecks?"

I never got a response back.

Probably because you came off as an annoying prick.

 

[CastleRubric]

So - to what extent does the Federal govt regulate insurance?
If you create a commercial policy for a family - are there federal acquisition type clauses or regulations?

Or is it a company (seller) specific framework that doesn't cite state / federal regulations?

PS - Israel started their military response against Iran about 25 minutes ago
I only mention this because the current parameters of this ME conflict "isn't business as usual "

 

[CastleRubric]

PS - sorry for cussing so casually as I sometimes do

I have been reminded @ UK this isn't "ok" (and allegedly written

But all those years as an enlisted dude THEN working aside DoD contractors that were former Army rangers or - ANY species of Marine ...it just soaks into you

Like a filthy but - fraternal - type of expression method

 

[JumperJack]

I've got State Farm for home and auto and it's skyrockted. I asked my agent why since I never claim anything. She said "look at it this way, we're all in this together and when we have a lot of claims, we have to raise prices for everyone since we're all in the same bucket."

I said "so are illegals having lots of car wrecks?"

I never got a response back.

You touched on a big part of the problem.

I’ve come to believe that if you choose to build in a hurricane or wildfire zone, you ought to pay more. I know people will say that there’s risk everywhere but I haven’t had to file a claim in 25 years. Why should I pay more for illegals and people that want to live on the beach?

 

[Pelosigalore]

So - to what extent does the Federal govt regulate insurance?
If you create a commercial policy for a family - are there federal acquisition type clauses or regulations?

Or is it a company (seller) specific framework that doesn't cite state / federal regulations?

PS - Israel started their military response against Iran about 25 minutes ago
I only mention this because the current parameters of this ME conflict "isn't business as usual "

I’d rather just not pay sales taxes to the government on my premiums.