USAA and problems insuring vacation home! (Rehoboth Beach: rental homes, insurance, mortgage)

[richard's girl]

We've had USAA for over 60+ years... my dad for 65 and me for the last 3. We've have a family beach house in Rehoboth for 40 years, that Dad had covered, and now I have taken over the coverage since his death.

The house was in the name of a Trust, until this summer when I redeeded it to myself personally. I was considering renting it out for some end of summer income, so I listed it with a local realtor. Bam! I get a notice from USAA saying they have cancelled my insurance on the property, without any reason. I called today, and they said they do NOT insure 'short-term rental properties'... only long-term (one-year) rentals. I was floored! As is turns out, there are other companies that DO insure beach rentals, but USAA is not one of them.

I told them I hadn't YET rented it out for a summer rental, but was considering it for next year. "Why can't I just have you reinstate the insurance that says I won't rent, and then in 9 months, if I change my mind and decide to rent, I'll change to another carrier that does rental homes. She said "no, then that would be less than nine months, and that would be considered that (I) only used it SHORT TERM myself!!!" ?????? Does THAT make any sense?

But, the gal actually didn't want to insure it at all, as I said it was a 'vacation home or second home' Get this -- she said they wouldn't because it was 'vacant'. I said no way it was vacant -- that it's furnished, has my clothes hanging in the closet, food in the fridge, etc, we use it all the time, on weekends all year round, almost all summer some family member is there, and even though my permanent address (another property they insure for me) is in another state, my job is in Delaware, so I come and go all the time from the house as well every two weeks all year long. She kept saying no, it's VACANT. I asked "well, tell me, how do people insure second homes?" and "how am i supposed to live in two places at once... if I'm there, then I'm not here (in Maryland)... so which is it???" Her reply -- "well that's a problem too! now you're telling me you are leaving your Maryland house vacant to go to the second home?"

ARGGGGHHHH! I am beside myself! I have never heard such nonsense!!!

Has anyone else come across this problem with insuring either their 'vacation home' or their rental property? and can anyone recommend a carrier that is experienced with Delaware beach properties?
thanks in advance!

[TeddyP27]

Wow.. that so does NOT sound like a USAA rep to me. I'd take it up the food chain at least to get a reasonable explanation. I've only uses USAA for primary residence but perhaps vacation properties are not within their comfort zone (especially when companies may still be a little "Sandy-shy").

[richard's girl]

Yes, unusual for me too, Teddy... I've never had problem with USAA until now.

The gal on the phone clearly was just going by whatever script she was trained on. For the life of me, I couldn't get her to understand my 'Lifestyle' -- that is, someone who owns two homes, who also travels for work, etc. I am certainly not the first person ever to do either! She just couldn't get past the "vacant" definition....

She said Underwriting would get back to me within 48 hours, but I am already looking for another agency to cover me.

Anybody else comment on a similar experience or problem with USAA or any insurance company covering a second vacation home? or a recommendation locally?

[nuts2uiam]

I am a USAA dependent and thereby insured. I was insured in NY by USAA then but today I could not get insurance there for the same home, nor will they write insurance here in Rehoboth Beach. Seems, like much of the NJ and NY areas, they are not insuring in this area at all. It may "simply" be that once the original insurance was cancelled it then became a new policy and that is why you were denied as opposed to the vacancy issue. That said, you obviously can't be in two places at once and therefore your legal "residence" is Maryland. I however, would call and ask to speak with a supervisor about this entire thing and be calm and have all your ducks in a row when you call.

[daFrogMan]

FWIW, my stepdaughter got employed with USAA in the mortgage division. She was really hot on the idea on trying to help out the people who take care of us 'commoners' by defending our country. Spent 3 weeks in training and after 2 weeks on the job, quit without another source of employment as she couldn't take the stress with the requirements for the application process and denials. After speaking to her, it's just another business trying to extract the most $$ out of people and using taking care of our troops as a ploy. I wonder if the ins company div isn't the same.
Oh on a side note, working on insurance with our company we've been with since the '70's. No go, it's all about money! They don't care about you, only the bottom line. However if you do need them some day, you'll be glad you had them. Found out this is true 2 years ago. (not homeowners, just ins in general). Remember, we live in a capital country, (nothing wrong with that!) but it's gotten much tougher than it used to be before.
Shame.

[DanBev]

We purchased a home in CT on a seasonal basis since we will not move till next year.It is spelled out very clearly the home cannot be occupied buy anyone but owner.We have a very high deductable,only looking at catastrophy.Twelve month policy was reasonable.
This was spelled out in no uncertain terms.

[rdlr]

It's not only USAA. I see this all the time in my line of work, and experienced it personally. Vacant houses are not insurable, unless you pay an arm and a leg, and then you must pay the premium in full for 1 year in advance. Even if the house is on the market, even if you live in it part time, the premium is huge! And, it's difficult t find an insurance company who will insure it, even at that.

When my mother passed away a few years ago, her insurance company cancelled the homeowners policy 2 months after she passed, and never told us. I hadn't received a recent insurance bill, called them, and they said they saw the obituary in the paper, visited the property, and cancelled the policy. They wouldn't insure the property for any amount of money, so we went to another company, and another, and another. Finally, we got one to insure it for $2,800 a year in advance, on a 900 sq.ft. house.Then a water pipe broke in the baseboard hot water heat and the insurance company wouldn't pay for that repair and damage, saying.....well, the house was vacant.

[DanBev]

Originally Posted by rdlr

It's not only USAA. I see this all the time in my line of work, and experienced it personally. Vacant houses are not insurable, unless you pay an arm and a leg, and then you must pay the premium in full for 1 year in advance. Even if the house is on the market, even if you live in it part time, the premium is huge! And, it's difficult t find an insurance company who will insure it, even at that.

When my mother passed away a few years ago, her insurance company cancelled the homeowners policy 2 months after she passed, and never told us. I hadn't received a recent insurance bill, called them, and they said they saw the obituary in the paper, visited the property, and cancelled the policy. They wouldn't insure the property for any amount of money, so we went to another company, and another, and another. Finally, we got one to insure it for $2,800 a year in advance, on a 900 sq.ft. house.Then a water pipe broke in the baseboard hot water heat and the insurance company wouldn't pay for that repair and damage, saying.....well, the house was vacant.

My home in Ct is 1200 sq ft with attached garage.They used a computer program to build house one stick at a time and said replacement cost was $166,000 even though we bought it from estate at $114,900.House is 1955 completely 100 percent upgraded,we were lucky.Cost for one year insurance $654 with $5000 deductable,my concern is fire and lightning.We are 100 ft from fire hydrant.
Remember a vacant home will have difficulty insuring and we were lucky to find this insurance man who had this knowledge about seasonal homes.
Nationwide Ins.

[rdlr]

Originally Posted by DanBev

My home in Ct is 1200 sq ft with attached garage.They used a computer program to build house one stick at a time and said replacement cost was $166,000 even though we bought it from estate at $114,900.House is 1955 completely 100 percent upgraded,we were lucky.Cost for one year insurance $654 with $5000 deductable,my concern is fire and lightning.We are 100 ft from fire hydrant.
Remember a vacant home will have difficulty insuring and we were lucky to find this insurance man who had this knowledge about seasonal homes.
Nationwide Ins.

Most likely, they used The Marshall & Swift Cost Estimator/Handbook. I use that in my line of work. My mom's property was WAY out in the boonies on 7 acres....no other houses around. Lots of strikes against it - Location, size of house, property on border of flood plain. As it turned out, an Amish family bought it and they LOVE it! So nice to see the property improved, horse barns and fencing built, hay field, strawberry patch and lots of flowers!

[TimtheGuy]

Dump 'em and get a local agent that is either independent or with a major carrier. I don't deal with USAA to often, but I do with vacation home regularly and I have never had a customer with any kind of insurance issues because the subject property was a 2nd home.