Check your USAA Policy (appointed, for sale, renters)

[NC211]

Moral of the post: If you're with USAA on your home policy, you might want to check the coverage amount.


Just thought I would share since I know we have a lot of our finest living here who use USAA. I've been with them my entire life. Never had another insurer, ever, for my cars or home. Never filed a single claim, ever. Perfect driving record, no points, ever, and I'm in my mid-40's. Even used the banking aspect. Never a problem and swore up the left and down the right that they're my favorite. Until recently.


We bought a house last year. They required that it be inspected for the policy. Said it was because the cost was over a certain amount (which, around here, isn't out of the norm at all...but I digress.)


The inspector completely blew it. Said the home had a replacement cost of nearly $1,000,000. I can assure you, I'd sell the sucker (and so would any of my neighbors) if someone offered me $1,000,000. What his estimate equated to was a price per square foot that suggested what the retail price would be if built new by a developer today in a hot market, which includes the land component. I argued and argued with them. Pointed out that we're not rebuilding the land, just the structure that is sitting on it, which is not a custom home structure at all (in fact the same builder is still building the same home today, 16 years later.) I provided proof (as much as I could without violating confidentiality clauses with other builders in my area now). They would not budge. Said their guy was an "expert". I even sent the inspector an email and pointed out his mistake, and was given the brush-off and told to call the 1-800 # to USAA to discuss (which I had already done).


USAA offered me coverage for 95% of their replacement value. Still waaaayyy tooo high. Then said they'd waive off their standard 20% buffer amount. Again, still too high to build a spec-built home, but closer to normal. But at that point, I was done being put on hold.


I called another national insurer who actually has local people in local offices here, one down the road from me actually. End of the day, they hit it right on the head the first time. All-in to include my cars, and a new 7-figure general umbrella policy which I didn't have at USAA, came out to 48% of what I was paying at USAA. Primarily in the home insurance amount.


All because of what USAA thought my replacement cost should be. So, moral of the story, if you have USAA as your home policy provider and haven't taken a look for a while, you might want to double-check to make sure you're not way over insured due to a faulty inspector estimate. I think it's really crappy for them to do that to me, and I did not appreciate it. And considering they cover the military folks too, who deserve our protection and admiration, I really think it's crappy if there is more of this around here. I hope not, but that's why I'm posting this.


What baffles me though, is that USAA is a Joint Venture partner with certain home builders in our area, and have been for many years! They have the data of what it really costs to build a single family home in this area! My last home was built by them! For them to suggest this new price is the actual price, well, then we've seen the cost of labor and materials go up by 130% in the past 60 months. Which, is absolute BS.


Rant over!

[timetofly733]

Mine went up really high a few years ago, I just logged in to my account and changed the house value number to what it should be and my rates adjusted accordingly. Haven't had any problems, but I do keep my eye on it yearly to make sure the number is what I think it should be.

[slduvall]

29 year member of USAA. After insuring many homes with them, we never will again. It is my understanding it is a separate company, subsidiary or something. We lived in NW FL after Katrina, and they cancelled and or refused to renew many policies of retirees. We were still active duty, so figured no problem. Well we go to move and it is 2008, don't want to sell in that market and they refused to provide the renters (dwelling only) policy. Fast forward two years and we are considering life insurance. Still active duty - they refused to insure him because "he could potentially be in harms way" no freaking s**t. The argument of it being a military insurance company was completely lost on each and every person we talked to. We made them remove the policy and wipe out all record of it..not sure if that is possible, or if they really did. When you fill out life insurance forms you are asked if you have every been refused life insurance. There is not a block for stupid reasons. We turned around and got a fabulous policy with another insurance company.

We still bank there..but refuse to use any of their "profit margin" products. Rant over...

[lindy112]

The same happened to us ... we live in a historic home and, after the inspector stopped by, he assigned a replacement value to the house of twice what we paid for it! I argued and argued with USAA that, if the house burned to the ground, we wouldn't try to "replace" it ... we would not drive around looking for 125-year-old hardwoods, stained glass, etc. We would just build a brand new house on our lot. They finally agreed to lower it some but it's still being insured for substantially more than we paid. I'm currently insurance-shopping.


And the same happened with us for life insurance. When we tried to get a policy for my husband through USAA (who was in the 82D ABN at the time), they refused him because he participated in "parachuting activities." Uh ... yeah ... that's his job!

[NC211]

We finalized our new policy just this morning with State Farm. $1m Umbrella, home owner's, two cars, earthquake, water (sewer sump pump), personal belonging, and $1,000 deductible...... all for 80% of what I was paying for JUST my home owner's policy that did not include earthquake from USAA alone, and that was at a "discounted" policy rate because they had the cars too.

Even though our home is now 17 years old, the builder is still very active in our area. I literally sent them three internet links directly to three brand new homes currently for sale from the same builder with nearly the same land size and more square footage than our home, that I could buy today for what they said it would cost to just rebuild our structure. Their new homes are literally 5 miles away in a very popular new development that is achieving a premium in the market in general. And they still wouldn't accept it as proof. Same builder. No change in the 30 years they've been building homes here. Heck, the model name of the new home is basically the same model name of our 17 year old home, and even has a near identical floor plan.

Something is wrong with USAA. That's just laziness on their part. I am REALLY disappointed in them for this, if not completely shocked. I'd expect these types of antics from a lower-tiered insurance company. This is a decision that I really did not want to make. I would have been fine with paying a little bit more to stay with them, but we're talking about a grand or two difference annually, which I can't justify. I don't work for free, and I don't expect anyone else to either, but that's just theft. I'd almost be inclined to report this to the national insurance commissioner to look into, since USAA represents our nation's finest and bravest.

[Old Guard]

How do I figure out what my home replacement value should be, not including the land?

I am trying to join USAA and the original estimate was almost twice what I am paying now. I would rather have USAA as I believe they are a really good company to deal with if you have to file a claim.

[NC211]

Originally Posted by Old Guard

How do I figure out what my home replacement value should be, not including the land?

I am trying to join USAA and the original estimate was almost twice what I am paying now. I would rather have USAA as I believe they are a really good company to deal with if you have to file a claim.

A basic estimate/idea approach would be to take around 75% of you home's tax value to figure out what it'd cost to rebuild if something happened.

[Sunscape]

Good thread. Informative.
We have been with them for our lifetime, so will check on this.

[SmartMoney]

Insurance does not reward loyalty. Rates are low to reel you in, but don't look for the competitive quotes to continue moving forward. Those disappearing deductibles are paid for, by you. One year newer - paid for, by you.

Every 4 to 5 years, shake it up and move your home and auto policies.