The fleecing of the American Homeowner.

[DoubleAtotheRON]

I couldn't really think of another place to post this, but...2023 has been a total clusterfuck for homeowners because of rising Property Insurance. Some in California saw as much as a 1036% increase in premiums, as over a dozen insurance carriers have pulled out of the State completely, along with LA, FL, and CO. Last year, we saw a 44% increase over 2022. We renew in October, and will not qualify anymore because as of Jan 1st, they will no longer cover homes over 10 years old, or with a roof over 5 years old. For those of you with a mortgage, Im sure you've seen your payments go up as the need to fund the escrow account has been adjusted... or, you may find yourself looking for a new carrier because you don't qualify anymore. Seems like there is going to be a whole bunch of folks that simply won't qualify, or be able to afford it if they can get it, and be forced into being "self Insured"... which is risky in some regions that are prone to wildfires, hurricanes, tornadoes, hail, etc. I'd like to hear some feedback or thoughts from others around the US. My agent keeps me posted on the current pulse of the market, and looks like Progressive, along with a few others have halted new policies until further notice starting this month.

 

[hanimmal]

Paying for the decades of lax regulations and inability to deal with our pollution that has led to the climate change we are dealing with sucks when the insurance companies decide they can no longer afford to pretend living in dangerous places environmentally is affordable for anyone that is worried about making their mortgage payments.

 

[DoubleAtotheRON]

Paying for the decades of lax regulations and inability to deal with our pollution that has led to the climate change

Im not sure Im all on board with climate change, when almost 90% of California's wildfires are started with human intervention. Irresponsible campers, campfires not put out, etc. The human population has more to do with that. Same thing with high concentrations of people/property in the Keys... If they didn't populate there, there wouldn't be anything to insure. But that's neither here or there. I guess my whole point was to see how everyone else across the US has been affected by this, and not just in high risk areas.
https://www.axios.com/local/san-diego/2023/08/24/california-wildfires-human-caused#

 

[hanimmal]

Im not sure Im all on board with climate change, when almost 90% of California's wildfires are started with human intervention. Irresponsible campers, campfires not put out, etc. The human population has more to do with that. Same thing with high concentrations of people/property in the Keys... If they didn't populate there, there wouldn't be anything to insure. But that's neither here or there. I guess my whole point was to see how everyone else across the US has been affected by this, and not just in high risk areas.

Im thinking about all the conditions that we have set that has put us in this situation of more extreme climates.



Not much has changed in my neck of the woods pricing wise. But we have a pretty easy going environment. I am just happy that the Biden Democrats won in 2020 and stopped the housing crisis that would have occurred like the last time the Republican economy melted and all that money people had wrapped up in their homes was destroyed with their 'let it fail' edge lord nonsense.

 

[DoubleAtotheRON]

Im thinking about all the conditions that we have set that has put us in this situation of more extreme climates.

View attachment 5371144View attachment 5371145

Not much has changed in my neck of the woods pricing wise. But we have a pretty easy going environment. I am just happy that the Biden Democrats won in 2020 and stopped the housing crisis that would have occurred like the last time the Republican economy melted and all that money people had wrapped up in their homes was destroyed with their 'let it fail' edge lord nonsense.

That's good to hear that you're not seeing these crazy spikes in premiums. Are we about to see another bubble pop?... maybe. Though info from some real estate friends, the last couple of years has been crazy with the Feds raising the rates every few months. They'll get a client landed on a property, and by the time they go to close, the rates go up by .75 bias points, and throws thier PTI out of wack, and they have to re-shop for another property. Same thing happened with my brother in law. They spent a year building a house, and as you know, you'll pay a higher rate on a construction note as you build. When you're finished, you close on your "permanent" rate. When they went to close, their PTI disqualified them. They wasted a whole year, money, time, rental, etc. What a shit show that was. They had to give it up to the bank, and go move back in thier original home they had put up for sale... which did not sell in a year's time.

 

[hanimmal]

That's good to hear that you're not seeing these crazy spikes in premiums. Are we about to see another bubble pop?... maybe. Though info from some real estate friends, the last couple of years has been crazy with the Feds raising the rates every few months. They'll get a client landed on a property, and by the time they go to close, the rates go up by .75 bias points, and throws thier PTI out of wack, and they have to re-shop for another property. Same thing happened with my brother in law. They spent a year building a house, and as you know, you'll pay a higher rate on a construction note as you build. When you're finished, you close on your "permanent" rate. When they went to close, their PTI disqualified them. They wasted a whole year, money, time, rental, etc. What a shit show that was. They had to give it up to the bank, and go move back in thier original home they had put up for sale... which did not sell in a year's time.

Higher rates (and regulations) will stop people from having 5 homes with 105% mortgages like there were back in '08 due to non-bank financial institutions being able to give anyone and everyone loans they couldn't afford, so I doubt there will be a bubble pop. But never know, Putin could start ww3 or another Republican could get elected and cause another economic collapse.

Having homes go from $170k down to $30k around the neighborhood I lived in back during the Republican economy in '08 vs a bit higher interest rates causing people to stay in their homes after not losing them after Trump's shit handling of our economy in 2020 making it harder on new construction/new home purchasing seems like a no brainer to me.

It does suck about your brother in law, sorry that happened to them. Glad to hear they were not left without a chair when that music ended though.

 

[DoubleAtotheRON]

Higher rates (and regulations) will stop people from having 5 homes with 105% mortgages like there were back in '08 due to non-bank financial institutions being able to give anyone and everyone loans they couldn't afford, so I doubt there will be a bubble pop. But never know, Putin could start ww3 or another Republican could get elected and cause another economic collapse.

Having homes go from $170k down to $30k around the neighborhood I lived in back during the Republican economy in '08 vs a bit higher interest rates causing people to stay in their homes after not losing them after Trump's shit handling of our economy in 2020 making it harder on new construction/new home purchasing seems like a no brainer to me.

It does suck about your brother in law, sorry that happened to them. Glad to hear they were not left without a chair when that music ended though.

Yes, I was a finance manager (car biz) back in that day. That was the Lending Industries fault. Way to much sub-prime lending at great rates, even tho they could barley afford them monthly payments. I think they learned thier lesson on that one. These days, it's just a matter of how much you can budget in at 7% on a home... AND if you're willing to just wait it out and pay rent for a while till things cool off. Im glad I don't have a mortgage for sure.

 

[printer]

I doubt things will get better.

BNN Bloomberg – Canada Business News, TSX Today & Interest Rates

Get the latest Canadian business news, TSX updates, interest rates and Bank of Canada coverage. Explore stock market investing and get expert financial insights on investment portfolio strategies.

www.bnnbloomberg.ca

Where auto and home insurance rates are headed

Premiums rose year-over-year in all provinces in Canada in personal auto and personal property lines, Applied Systems said.

www.canadianunderwriter.ca

 

[ooof-da]

I couldn't really think of another place to post this, but...2023 has been a total clusterfuck for homeowners because of rising Property Insurance. Some in California saw as much as a 1036% increase in premiums, as over a dozen insurance carriers have pulled out of the State completely, along with LA, FL, and CO. Last year, we saw a 44% increase over 2022. We renew in October, and will not qualify anymore because as of Jan 1st, they will no longer cover homes over 10 years old, or with a roof over 5 years old. For those of you with a mortgage, Im sure you've seen your payments go up as the need to fund the escrow account has been adjusted... or, you may find yourself looking for a new carrier because you don't qualify anymore. Seems like there is going to be a whole bunch of folks that simply won't qualify, or be able to afford it if they can get it, and be forced into being "self Insured"... which is risky in some regions that are prone to wildfires, hurricanes, tornadoes, hail, etc. I'd like to hear some feedback or thoughts from others around the US. My agent keeps me posted on the current pulse of the market, and looks like Progressive, along with a few others have halted new policies until further notice starting this month.

the craziest part for me is the trend of the insurance companies just pulling the coverage. like not just “raising rate”, but like not offering it anymore. This is CA-centric data of instances that the insurer initiated the cancellation….

 

[Phytoplankton]

I couldn't really think of another place to post this, but...2023 has been a total clusterfuck for homeowners because of rising Property Insurance. Some in California saw as much as a 1036% increase in premiums, as over a dozen insurance carriers have pulled out of the State completely, along with LA, FL, and CO. Last year, we saw a 44% increase over 2022. We renew in October, and will not qualify anymore because as of Jan 1st, they will no longer cover homes over 10 years old, or with a roof over 5 years old. For those of you with a mortgage, Im sure you've seen your payments go up as the need to fund the escrow account has been adjusted... or, you may find yourself looking for a new carrier because you don't qualify anymore. Seems like there is going to be a whole bunch of folks that simply won't qualify, or be able to afford it if they can get it, and be forced into being "self Insured"... which is risky in some regions that are prone to wildfires, hurricanes, tornadoes, hail, etc. I'd like to hear some feedback or thoughts from others around the US. My agent keeps me posted on the current pulse of the market, and looks like Progressive, along with a few others have halted new policies until further notice starting this month.

I have a couple properties, one is in the mountains by Mt. Lassen (a volcano), and insurance is horribly expensive because of the fire danger. Kinda weird, because in the last 15 years we've had three fires and most everything is burned around the property (but not on it), in reality there's not much left to burn. What's funny is I also have volcano insurance, and it's cheap. I started shopping around and was told by several agents to keep my current insurance, becaue no one will pick up insurance in a fire zone, they don't care about the volcano! The house I live in is insured, BUT, it's in a flood zone (10), so I do not have flood insurance, it would be almost 10K a year, so for floods I'm self insured.

 

[cannabineer]

the craziest part for me is the trend of the insurance companies just pulling the coverage. like not just “raising rate”, but like not offering it anymore. This is CA-centric data of instances that the insurer initiated the cancellation….

View attachment 5371292

Behold the reality of small government. At this point in Libertaria, competitors would step in and seek to out-low-bid each other.

q.e.d. the libertarian concept does not conform to reality.

 

[hanimmal]

the craziest part for me is the trend of the insurance companies just pulling the coverage. like not just “raising rate”, but like not offering it anymore. This is CA-centric data of instances that the insurer initiated the cancellation….

View attachment 5371292

The pre-ObamaCare mode of insurance,'oh you need to use it, sorry preexisting condition, you lose'.

 

[DoubleAtotheRON]

the craziest part for me is the trend of the insurance companies just pulling the coverage. like not just “raising rate”, but like not offering it anymore. This is CA-centric data of instances that the insurer initiated the cancellation….

View attachment 5371292

Thinking back on this, my last hail claim was over 5 years ago for a hail storm. I have 1 traditional home, 1 Barndaminium, and 3 shop buildings. The Barndaminium and the 3 shops are all metal, including roofs. My insurance company paid out a stupid amount of money on every tiny ding on those roofs, which I didn't fix because you can't even see them unless you get on the roof and look at it at the right angle. $63K payout, and $15K to replace my main home's shingle roof, $4K deductible, so guess where the rest went?..... in light of that, maybe this runs linear with the 08' lending crisis?... they just paid out too much over time and found thierselves running towards the red by paying out too much for claims. My agent, and a few other local agents went to social media to explain that last years explosive increase was not them.... it was the State that sets the rates. Well, to me some governing body outside of the state sets the rates. Progressive, Farmers, State Farm, etc are National Companies. These are statements from my agent from either email, or other agents on Social Media.......

 

[hanimmal]

Thinking back on this, my last hail claim was over 5 years ago for a hail storm. I have 1 traditional home, 1 Barndaminium, and 3 shop buildings. The Barndaminium and the 3 shops are all metal, including roofs. My insurance company paid out a stupid amount of money on every tiny ding on those roofs, which I didn't fix because you can't even see them unless you get on the roof and look at it at the right angle. $63K payout, and $15K to replace my main home's shingle roof, $4K deductible, so guess where the rest went?..... in light of that, maybe this runs linear with the 08' lending crisis?... they just paid out too much over time and found thierselves running towards the red by paying out too much for claims. My agent, and a few other local agents went to social media to explain that last years explosive increase was not them.... it was the State that sets the rates. Well, to me some governing body outside of the state sets the rates. Progressive, Farmers, State Farm, etc are National Companies. These are statements from my agent from either email, or other agents on Social Media.......

View attachment 5371354View attachment 5371357View attachment 5371355View attachment 5371356

Then I hate to be the one to point it out, but if you only spent $20k of the $64k that the insurance company gave you to fix the damage, doesn't that mean you are the one (in this case) fleecing homeowners?

It really is a lot like the people who caused the problems in '08 housing bust (the people who made mint on flipping homes for far more than they bought/invested in) vacuuming up all that money and pointing to the 'banks' as the problem.


lol this came out a little snarky, I'm sorry that is not my intention. I just don't really know how to word it differently.

 

[DoubleAtotheRON]

Then I hate to be the one to point it out, but if you only spent $20k of the $64k that the insurance company gave you to fix the damage, doesn't that mean you are the one (in this case) fleecing homeowners?

It really is a lot like the people who caused the problems in '08 housing bust (the people who made mint on flipping homes for far more than they bought/invested in) vacuuming up all that money and pointing to the 'banks' as the problem.


lol this came out a little snarky, I'm sorry that is not my intention. I just don't really know how to word it differently.

Well, what would you do? "Hey!, you gave me too much money, let me send you a check"...... It was my choice not to fix every single tiny dent on those roofs. They're insignificant. And I know I profited from it. You'd do the same thing. My point being, they just way overpaid on claims over a few years, suddenly there is a spike in claims, and now they want to pull out. They're the gamblers, not me. I mean hell, I've paid that much in over 23 years, plus some...so I just figured I broke even.

 

[DoubleAtotheRON]

Actually, they still made money on me over that time period.

 

[Phytoplankton]

Then I hate to be the one to point it out, but if you only spent $20k of the $64k that the insurance company gave you to fix the damage, doesn't that mean you are the one (in this case) fleecing homeowners?

It really is a lot like the people who caused the problems in '08 housing bust (the people who made mint on flipping homes for far more than they bought/invested in) vacuuming up all that money and pointing to the 'banks' as the problem.


lol this came out a little snarky, I'm sorry that is not my intention. I just don't really know how to word it differently.

Not really, he suffered a loss of value (which is what insurance is for), he was compensated for it. After that, it's his decision to fix what he wants. In any event, the unfixed stuff is still a loss of value when he sells.

 

[DoubleAtotheRON]

Not really, he suffered a loss of value (which is what insurance is for), he was compensated for it. After that, it's his decision to fix what he wants. In any event, the unfixed stuff is still a loss of value when he sells.

.... and I don't plan on selling. I'll prob die here. Which is what I plan to do. If I didn't like it here, I would have moved after 23 years. It's all paid for, so why not? And for some reason If I did have to downsize, materials to build in 2001 cost me $58 a sq ft. I don't think you can build these days for less than $175 or possibly more. 12 half wooded acres back then was $20K. Now, prob closer to $150K.

 

[hanimmal]

Well, what would you do? "Hey!, you gave me too much money, let me send you a check"...... It was my choice not to fix every single tiny dent on those roofs. They're insignificant. And I know I profited from it. You'd do the same thing. My point being, they just way overpaid on claims over a few years, suddenly there is a spike in claims, and now they want to pull out. They're the gamblers, not me. I mean hell, I've paid that much in over 23 years, plus some...so I just figured I broke even.

I really wasn't trying to call you out on it, and do not blame you for keeping the money.

It sucks. I was in sales during the lead up to the '08 financial collapse and know that I profited off of it too. It is that crap feeling when I think back to how many times I would run peoples credit for something and see how hard it was for them to cover everything and go ahead and toss it onto a free 12 month program that would greatly inflate when they didn't pay it all off before the year was up.

I wouldn't call them (the insurance companies) gamblers as much as a bunch of people making money looking the other way at all the little micro tears in the fabric keeping it all together because, well, what would you do?

Not really, he suffered a loss of value (which is what insurance is for), he was compensated for it. After that, it's his decision to fix what he wants. In any event, the unfixed stuff is still a loss of value when he sells.

I think insurance is great and am happy that he had the option of using it to fix the damages he faced.

 

[Phytoplankton]

.... and I don't plan on selling. I'll prob die here. Which is what I plan to do. If I didn't like it here, I would have moved after 23 years. It's all paid for, so why not? And for some reason If I did have to downsize, materials to build in 2001 cost me $58 a sq ft. I don't think you can build these days for less than $175 or possibly more. 12 half wooded acres back then was $20K. Now, prob closer to $150K.

I'm in the same boat, they'll dump my ashes in the river in front of the house. The property has been in the family for 70 years, and some of my fondest childhood memories of this house are duck hunting with my grandfather. Gramps paid $600 each for the two river front lots in 1953. One lot just sold down the road for 280K, and it's not even a deep water lot!