Homeowners Insurance DOUBLED!!!!

[timandlesley]

Well, I put a call out to an independent agent today. I called Allstate back and they told me it was due to rates increased in our area plus I lost a 30% discount because I switched our auto policy. I did this because every time I called Allstate's auto department the people answering the phones were located in India and I couldn't understand them, even the managers. Also I saved 60 bucks a month by switching to progressive.
Hoping I get some good news today from the independent agent, I'll let you know.
Lesley

 

[DVCBELLE]

http://homebuying.about.com/od/4closureshortsales/qt/110507_Fixtures.htm

What Happens to Sellers Who Strip Their Homes?

According to a representative from Downey Savings and Loan, it's the home owner's insurance companies that are most likely to pursue and prosecute sellers who vandalize or strip their homes while in foreclosure. When the bank receives title to the home through foreclosure proceedings, many banks submit an insurance claim to the existing insurance company to cover damage and missing real property items.

Insurance companies then actively go after the sellers because the company has faced a loss due to the seller's intentional behavior. Believe me, insurance companies are relentless, committed to collection and will prosecute to the fullest extent of the law.

I am wondering what is going to happen in our area to our rates. We were hit with a nasty hailstorm, lots of damage/claims. Even though it is an act of God, I wonder if we'll be hit with a rate increase.

See that just seems wrong. If you walk away from your home, I think the policy should lapse as well!!!

It sucks that not only is my property value dropping from people just walking away from their homes but also then that I have to pay a higher insurance premium - and people wonder why others get mad when they ask if they should walk away from their house or not

 

[dawson5]

It's just the bank protecting their behind. I can't imagine there not being some kind of coverage, just to protect their money until it's resold. I don't know if it's US wide but I know that we are required to have insurance on our home. So I would assume whether bank owned or family owned, there would have to be insurance. If there are a large number of claims in your area, rates will increase regardless if you have had a claim or not. I think it comes down to risk.

 

[jetprincess]

Did something change in your region? Our policy increased quite a bit because our fire department zoning changed. Might be something to check into!

 

[ZachnElli]

http://homebuying.about.com/od/4closureshortsales/qt/110507_Fixtures.htm

What Happens to Sellers Who Strip Their Homes?

According to a representative from Downey Savings and Loan, it's the home owner's insurance companies that are most likely to pursue and prosecute sellers who vandalize or strip their homes while in foreclosure. When the bank receives title to the home through foreclosure proceedings, many banks submit an insurance claim to the existing insurance company to cover damage and missing real property items.

Insurance companies then actively go after the sellers because the company has faced a loss due to the seller's intentional behavior. Believe me, insurance companies are relentless, committed to collection and will prosecute to the fullest extent of the law.

I am wondering what is going to happen in our area to our rates. We were hit with a nasty hailstorm, lots of damage/claims. Even though it is an act of God, I wonder if we'll be hit with a rate increase.

This article says sellers, but if it's a foreclosure they aren't really sellers are they? Most likely if they can't pay the mortgage, they can't pay the homeowner's insurance or sure don't want to for a house they no longer have and the policy lapses. So it's up to the bank, not the insurance company. Also, if the foreclosure is included in a bankruptcy, they can't go after the former "owners" (quotes because they obviously weren't really owners). Insurance companies raise their rates to make a profit. The costs to repair homes has gone up and they have to raise their rates to continue to make their profit. Look at the insurance companies profit margines, most of them are not hurting. Especially the ones that didn't invest in the stock market and are privately held.

I worked in a State Farm office and if our underwriters got a notice from a bank that a house was in foreclosure, they would drop the policy as soon as legally possible. Vacant houses are a much bigger risk than occupied homes, from vandalism, burglary, frozen pipes, etc. Some policies are even written that if vacant more than 30 days and the insurance company is not notified, and there is a loss, it will not be covered (did I mention I'm also licensed?).

 

[delmar411]

ours went up as well. Mostly because there have been a lot of claims in our area. Makes no sense I guess unless they are theft claims and just being in the area makes us a possible target?

Also you have to remember if you unbundle your services you can lose some major discounts. The competing companies don't tell you that when you call for rates.

Our discount is huge and I won't ever unbundle our services. The bundle combined with length of business gives us more than 50% discount at this point.

 

[KerBear]

http://homebuying.about.com/od/4closureshortsales/qt/110507_Fixtures.htm

What Happens to Sellers Who Strip Their Homes?

According to a representative from Downey Savings and Loan, it's the home owner's insurance companies that are most likely to pursue and prosecute sellers who vandalize or strip their homes while in foreclosure. When the bank receives title to the home through foreclosure proceedings, many banks submit an insurance claim to the existing insurance company to cover damage and missing real property items.

Insurance companies then actively go after the sellers because the company has faced a loss due to the seller's intentional behavior. Believe me, insurance companies are relentless, committed to collection and will prosecute to the fullest extent of the law.

I am wondering what is going to happen in our area to our rates. We were hit with a nasty hailstorm, lots of damage/claims. Even though it is an act of God, I wonder if we'll be hit with a rate increase.

This doesn't make sense to me either. When a mortgage is delinquent the mortgage company wil usually send someone to do a drive by inspection. If the property appears to be vacant the insurance company is notified. Some mortgage companies will automatically place vacancy insurance, others will wait to receive a cancellation from the insurance company to place it. Of course the borrower can dispute the vacancy if it is wrong, but a vacant home is generally NOT covered by a standard homeowners policy, in fact there is another post on this board about that exact situation.
Most likely the increase is the result of a large number of claims, like the windstorm and new roofs that were mentioned.

 

[A Mickeyfan]

You are lucky they aren't dropping you and others as many larger companies have done to us here in Fl. Alstate dropped me after my Charley claim. I am now paying nearly 3 times as much (with higher deductibles too) as I use to & had to go thru hoops to get insurance. Most are requiring that your home be "updated" and you must show proof. It is horrible here in Fl...
I know this doesn't make it easier for you, but just wanted to share what most of us here are going thru...

 

[eyor44]

Our insurance doubled a couple years ago. We live in South MS and were in the last group to have insurance go up due to Katrina. There was no reason for our insurance to go up as much as it did other than the fact that they can raise it. My local agent sent a letter prior to the increase. When I called to ask they were very apologitic and did offer a couple options to lower it a bit. My homeowners has gone up every year since then has had my property taxes. There is no way I could sell my house for what the county says it is worth.

As others have said, at least they haven't dropped me yet. But hey.....my car insurance went down $20 for the next 6 months.

 

[PinkRhombus]

I am SO frustrated and need some help. I have TONS of questions but of course our mortgage company isn't open.

We escrow our home owners insurance into our monthly mortgage payment. Allstate sent me our renewal quote today and it was DOUBLE the amount of last year, when I called and asked why they said "insurance rates in your area have risen dramatically"

It's because we had hurricane Ike come through with all that wind...then the ice storm....then there was a bunch of high winds last year around this time.

 

[dawson5]

This article says sellers, but if it's a foreclosure they aren't really sellers are they? Most likely if they can't pay the mortgage, they can't pay the homeowner's insurance or sure don't want to for a house they no longer have and the policy lapses. So it's up to the bank, not the insurance company. Also, if the foreclosure is included in a bankruptcy, they can't go after the former "owners" (quotes because they obviously weren't really owners). Insurance companies raise their rates to make a profit. The costs to repair homes has gone up and they have to raise their rates to continue to make their profit. Look at the insurance companies profit margines, most of them are not hurting. Especially the ones that didn't invest in the stock market and are privately held.

I worked in a State Farm office and if our underwriters got a notice from a bank that a house was in foreclosure, they would drop the policy as soon as legally possible. Vacant houses are a much bigger risk than occupied homes, from vandalism, burglary, frozen pipes, etc. Some policies are even written that if vacant more than 30 days and the insurance company is not notified, and there is a loss, it will not be covered (did I mention I'm also licensed?).

This doesn't make sense to me either. When a mortgage is delinquent the mortgage company wil usually send someone to do a drive by inspection. If the property appears to be vacant the insurance company is notified. Some mortgage companies will automatically place vacancy insurance, others will wait to receive a cancellation from the insurance company to place it. Of course the borrower can dispute the vacancy if it is wrong, but a vacant home is generally NOT covered by a standard homeowners policy, in fact there is another post on this board about that exact situation.
Most likely the increase is the result of a large number of claims, like the windstorm and new roofs that were mentioned.

Also the other post you cite in your reply came at 9pm, long after this. I had not seen it.

I offered this for reasoning, no one quoted that:

It's just the bank protecting their behind. I can't imagine there not being some kind of coverage, just to protect their money until it's resold. I don't know if it's US wide but I know that we are required to have insurance on our home. So I would assume whether bank owned or family owned, there would have to be insurance. If there are a large number of claims in your area, rates will increase regardless if you have had a claim or not. I think it comes down to risk.

So I went googling this morning and came up with this:
http://www.bankforeclosuressale.com/

Bank Foreclosed Homes

Bank foreclosed homes are also called real estate owned (REO) foreclosures. When property owners are unable to make payments on their bank-held mortgage loan, the bank forecloses on the property in an attempt to repossess it. This is how a property becomes a bank foreclosure home.

Experienced investors know that while a bank foreclosure is being processed, owners may sell their homes in order to avoid foreclosure. This period is referred to as the pre foreclosure period. Often times, owners are willing to negotiate a lower price for the sale of their home during this period so that they can avoid damage to their credit score. In the end, the investor gets a great price while the seller avoids foreclosure and maintains a good credit score. This is a win-win situation for both parties.

If the home is not sold before the foreclosure is processed, the title of the bank foreclosure home is transferred to the bank. Banks, however, do not like to own foreclosure properties. They are in the business of dealing with money, not real estate, and bank foreclosures are a burden on banks for several reasons:

* They are expensive to maintain - The bank must pay taxes, insurance, maintenance and security for their bank foreclosure homes. The longer they hold on to bank foreclosure homes, the more money they lose.
* The bank looks bad - Having a large inventory of bank foreclosure homes on their books highlights their bad lending decisions.
* The bank needs to recover the money lost on bank foreclosures.

Due to these reasons, banks try to get rid of bank foreclosures as fast as they can. This is how investors can capitalize on these properties. It is often possible to negotiate deals where you can buy bank foreclosure homes or government foreclosures at a price that is anywhere from 30-60% below market value.

With the incredible opportunity these properties present, you can make a nice profit every time you invest in bank foreclosure homes!

The only reason I quoted the first (seller) article that I posted was because I would assume that the same procedures would be used on a foreclosed home.

 

[JamesMom]

http://homebuying.about.com/od/4closureshortsales/qt/110507_Fixtures.htm

What Happens to Sellers Who Strip Their Homes?

According to a representative from Downey Savings and Loan, it's the home owner's insurance companies that are most likely to pursue and prosecute sellers who vandalize or strip their homes while in foreclosure. When the bank receives title to the home through foreclosure proceedings, many banks submit an insurance claim to the existing insurance company to cover damage and missing real property items.

Insurance companies then actively go after the sellers because the company has faced a loss due to the seller's intentional behavior. Believe me, insurance companies are relentless, committed to collection and will prosecute to the fullest extent of the law.

I am wondering what is going to happen in our area to our rates. We were hit with a nasty hailstorm, lots of damage/claims. Even though it is an act of God, I wonder if we'll be hit with a rate increase.

I am shocked that the isurance company would pay a claim based on improper use, negligence or other such language. If I neglect to fix a leaky roof, I am sure the insurance would deny a claim for the moldy structure (walls celings) and fixtures that result months later. And I doubt they would pay a vandalism claim without a police report. How are the banks doing this?

 

[sorul82?]

Well, I put a call out to an independent agent today. I called Allstate back and they told me it was due to rates increased in our area plus I lost a 30% discount because I switched our auto policy. I did this because every time I called Allstate's auto department the people answering the phones were located in India and I couldn't understand them, even the managers. Also I saved 60 bucks a month by switching to progressive.
Hoping I get some good news today from the independent agent, I'll let you know.
Lesley

I was gonna ask where you have your auto, and here it is! We are a big family of insurance agents here in NC, and I was told that Allstate is no longer writing one line without the other here. So, to punish you, for lack of better description, they raise your premium on the remaining line of business.

Allstate used to be a really good company. My dad was an Allstate agent for 30 years. He sold out at a good time. They are putting so much pressure on the agents now. We have a friend who was given 60 days to meet a life quota or else. Allstate will be at his office Wednesday to take all his files and his signage.

This is probably a lot more info than anyone wanted, but I have to say that I love being an independent agent. No quotas, no pressure!!

 

[sorul82?]

ours went up as well. Mostly because there have been a lot of claims in our area. Makes no sense I guess unless they are theft claims and just being in the area makes us a possible target?

Due to one tornado, everyone in that same zip code saw an increase. ONE tornado? Sheesh!

 

[NHWX]

If you're searching for a new insurance company, consider Amica. We've never had a house claim but the couple times when we've had a car claim, they've been great. That confidence in knowing that I'll speak with a person who understands what's going on, and that my claim will be taken care of properly is part of what I'm buying with my insurance.

NHWX

 

[dfchelbay]

We just renewed our homeowners insurance recently, so I looked around for less expensive coverage just last month. I got quotes from Progressive, Allstate, State Farm, AAA, USAA, and Geico. After going through all that legwork, we found that our current policy, even though it went up, was still cheaper than all the others we looked into, with higher coverages and extra things added too. We are insured with GMAC, and their homeowners is through Homesite Insurance. Maybe they will have less expensice rates for you too.

 

[ruadisneyfan2]

Also if you choose the same company for car and homeowners ins, you usually get a multiple policy discount.