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Old 11-16-2013, 06:15 PM
 
31 posts, read 100,564 times
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I'll be closing soon on a 3/2 condo, ~1400 sqft, purchase in 89103 for $125,000. In my estimated closing costs my agent has plugged in the cost of condo owner's insurance at $40 per month for an annual premium of $480.

That strikes me as high. I've already told my RE agent that I want to sit down with the insurance agent to discuss coverage. I'm sure if I let somebody arbitrarily set my coverage I'll end up over-insured. It's a commission based business, and I'm a trusting person but not stupid.

I'd like to go into this meeting with some knowledge of what people are paying on average for their condo owner's coverage, and which carriers ar known for offering the best rates. Any input would be greatly appreciated.

TIA.
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Old 11-16-2013, 06:24 PM
 
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I bought my ho6 policy through my escrow company, which was Chicago Title on Lake Mead. I paid about 165 for a year, but I go about as low on personal property as allowed, but did have 300K liability, with a 500 deductible. I think it was Fidelity National, which is parent co of Chicago Title, who was excellent both times. YMMV.
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Old 11-16-2013, 06:33 PM
 
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What does your agents estimate have to do with what you will pay? He or she is using some algorithm not a quote. Insurance is ordered by the homeowner or, if they don't, the loan originator on the property. If not financed no one orders the insurance. The classical formula is a half percent of the price. That is generally a little high on a condo.

Banks routinely over pay for insurance...so you never want the bank ordering it.

Agents only interest in insurance is that someone orders it and to warn the client not to get it through the bank.

And I know a specialist for snow birds and such. Be very careful on insurance policies if you are gone more than 90 days.
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Old 11-16-2013, 06:41 PM
 
Location: Salt Lake City/Las Vegas
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If you already have insurance (car, house, life, etc.), ask if your company will bundle and discount. If not, seek a bundle elsewhere. I've seen the lowest rates when I've done this.

Bill
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Old 11-16-2013, 07:11 PM
 
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Quote:
What does your agents estimate have to do with what you will pay? He or she is using some algorithm not a quote. Insurance is ordered by the homeowner or, if they don't, the loan originator on the property.
This is a cash purchase, and no one is ordering or requiring the coverage. Obviously it's entirely discretionary with me whether I want it or not, and it needn't even be a part of escrow. My agent is not using an algorithm. I told him it was okay to use one of his insurance pals, and I assume that person is the source of the $480 quote. I just happen to think on a gut level that it's on the high side, especially since one day he dropped the remark that on average it ran around $300 a year.

$300K seems to be the average for liability coverage, and I suppose I'd set personal property at around $100K. Does anyone know on average what that would cost? And BTW, how is flood coverage handled, if at all? Is interior structural damage an HOA liability? Do condo owner's policies even come with some sort of flood coverage rider available?
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Old 11-16-2013, 08:00 PM
 
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400 is a little high. It should be more around 250-300. Get an insurance broker to quote you their least expensive policy.
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Old 11-16-2013, 10:50 PM
 
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Quote:
Originally Posted by rdangel49 View Post
This is a cash purchase, and no one is ordering or requiring the coverage. Obviously it's entirely discretionary with me whether I want it or not, and it needn't even be a part of escrow. My agent is not using an algorithm. I told him it was okay to use one of his insurance pals, and I assume that person is the source of the $480 quote. I just happen to think on a gut level that it's on the high side, especially since one day he dropped the remark that on average it ran around $300 a year.

$300K seems to be the average for liability coverage, and I suppose I'd set personal property at around $100K. Does anyone know on average what that would cost? And BTW, how is flood coverage handled, if at all? Is interior structural damage an HOA liability? Do condo owner's policies even come with some sort of flood coverage rider available?
Ah comeon. You appear to be a big guy...you got $125K in cash. You are not up on how to get an insurance quote? And you should have personal coverage past a million dollars. That generally requires 300K liability on everything.

Why would you ask your RE Agent? Why not your valet parker or black jack dealer?

Flood is not available on any conventional policy. A government insurance pool is used. In general that is a problem for the condo association which covers the basic structure. You might check with your insurance agent on how damage within the unit will be covered. If not on the ground floor I would suggest ignoring the problem.
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Old 11-16-2013, 10:56 PM
 
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The master insurance policy of a condo would not cover a flood that is caused by pipe bursts that are outside the wall. I'd recommend getting a policy that covers water loss damage.
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Old 11-16-2013, 11:04 PM
 
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Originally Posted by ddrhazy View Post
The master insurance policy of a condo would not cover a flood that is caused by pipe bursts that are outside the wall. I'd recommend getting a policy that covers water loss damage.
That is not flood insurance...flood insurance is external water. And if you want fun start the question of who is responsible for an internal leak. You have to read the fine print in the CC&Rs. There are things called limited common elements...and they are just wonderful. And when a limited common element leaks whose problem is it? And when the limited common elements leak into a unit that is not assigned to the limited common element whose fault is it?

I can guarantee you from personal experience that neither the insurance companies or the HOAs understand how this works. So litigation...

But flood is an HOA problem primarily...
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Old 11-16-2013, 11:06 PM
 
6,357 posts, read 11,798,284 times
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Quote:
Originally Posted by ddrhazy View Post
The master insurance policy of a condo would not cover a flood that is caused by pipe bursts that are outside the wall. I'd recommend getting a policy that covers water loss damage.
There are no policies which cover this. Water which "touches the ground" in adjuster language can only be covered by a flood policy which has serious coverage issues of its own. Insurance policies basically hold the insureds responsible for making sure water can't enter into your residence from outside.

The $40 a month sounds quite high, but if you are using $100k as your property limit it's not too out of line. Most condos don't have that much property though so I would do an inventory and make sure you need that much.
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