Home Insurance costs (sales, real estate market, 2015)

[tbill]

Purchased new construction house in Feb 2018 and cost continue to increase annually. in 2011 +16%, '12 +16%,, '13 +8%, 2014 change deductible from $500 to $7500) decrease of 9%, '15 +12%, 2016 +8%. From 2010 premium went from $1105 to $1924 with no additional coverage, but a $7000 change in deductible.

What is your experience?

[ncrunner77]

My guess is that the value of your home has gone up dramatically, common in the current real estate market, and your rates have gone up accordingly. Every time there is a rate change your insurance company should send you a notice with updated paperwork disclosing their current valuation of your home and the coverage specifics. Has their valuation of your home gone up significantly? If not, and your rates have gone up that much that quick, I would consider switching companies. If so, does it make sense with other estimate sources of your current home value? If not, maybe switch companies. We are very happy with Amica; we think their estimate of our home is "fair", their rates are competitive and their service excellent.

[luv4horses]

I don't get it. Where do you get those 2011 etc numbers if the house will be built in Feb 2018? Or did you forget to proofread your post.

[MikeJaquish]

Originally Posted by luv4horses

I don't get it. Where do you get those 2011 etc numbers if the house will be built in Feb 2018? Or did you forget to proofread your post.

I'm guessing "2008."
Heck, I nearly wrote a check for "2015" just last week....

And, it is time to shop insurance companies. Pain in the neck, since most folks bundle home and car for discounts.

[carcrazy67]

Time to shop. My home has seen a significant increase in value over the past few years with very little impact on the cost of my insurance.

[cheapdad00]

OP, did you sign a consent to rate form in the last few years? There is a thread on here about its impacts.

[wheelsup]

Home price increases don't mean increase in insurance costs, since you are just insuring the structure. This shouldn't run more than inflation +/- a few % points, IMO. The biggest impact was the hurricanes and after that rates skyrocketed.

[tbill]

Originally Posted by luv4horses

I don't get it. Where do you get those 2011 etc numbers if the house will be built in Feb 2018? Or did you forget to proofread your post.

Yes, should have been 2008, not 2018. I have shopped companies and these are in the ballpark with other firms. We are with Erie. One would think the home should be worth more with the increases, but I'm not sure I can recover my original cost, based upon the sales on our street.

[ncrunner77]

Originally Posted by wheelsup

Home price increases don't mean increase in insurance costs, since you are just insuring the structure. This shouldn't run more than inflation +/- a few % points, IMO. The biggest impact was the hurricanes and after that rates skyrocketed.

I guess I'm confused then as we occasionally get statements from Amica that say exactly this "Our records indicate the coverage limit of your home needs to be adjusted. We are increasing your dwelling coverage to $xxx,xxx in line with our estimates". This statement comes verbatim from the cover page of a packet that explains our new increased coverage and the modest uptick in premium...couple bucks a month. The new coverage amount is always close to the rough estimates found on several online real estate sites of our home value and also close to what other similar homes in our neighborhood are selling for.

So, are construction costs going up that much? I think you are right about it (coverage) only covering construction costs. Our home value is going up and up, based on comps sold, and we keep getting these statements from Amica so I made the erroneous connection. Maybe I should change insurance companies as well?

So if you live in San Diego in a 1000 sqft house "worth" 800,000 the insurance coverage might only be for 150,000 - 200,000K to cover building a new similar structure on the same site/land?

[wheelsup]

With homeowners most of the insurance cost is to rebuild the home not the land. The land doesn't get insured. If your property increases by 50% one year, how much of that was land costs going up and how much of that was rebuild costs going up?

At USAA I tell them what I have in my house and they spec their rebuild costs on that. They are pretty familiar with how much a home costs to build in our part of the country using standard building materials. On a price/sq ft basis.

NC Farm Bureau and USAA were pretty close in their estimates. That being said you make a great point and I will go visit the NCFB office with my USAA packet and see what they can come up with.