We are advised that insurers with big losses in California fires may be raising premiums though out the country to rebuild their assets.
State Farm raised my rates, so I went shopping. I tried five companies. I saved $700 on homeowners.
Farmers gave me the best deal. Allstate was about the same as State Farm–mid range. American Home and Liberty were $1000 higher.
Nationwide began this with a mailing offering $1000 lower but when contacted claimed theirs were higher than State Farm.
If you have not reviewed your home owners prices recently a review may be worth the trouble.
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It is my understanding that insurance rate in Georgia are set by our insurance commission and not affected by losses in CA, NC or any other state.
What is you basis for thinking CA losses affect premiums in other state s?
That has been in news reports. Yes, they are state regulated but operate in many states.
Home owners insurance is essentially a commodity. You make some choices but most are cosmetic. Why is the quoted range so wide from $1K to $3K? Why is inflation larger at one insurer than another?
One aspect is overhead. Some have larger offices and more staff. The insured pay the higher cost.
Another has to be decisions made by the pros (aka actuaries) who set rates. For auto insurance, they have the benefit of claim experience and can follow trends. They may very well be able to predict next years claims within a few percent.
Home owners insurance is similar when it comes to typical storm damage or fire. The wild card is the mass event that might produce a billion dollars in claims. Big fires as in California or hurricanes. Your insurance probably anticipates those events based on history. Maybe one in 50 years. But they can decide to revise those charges to say 25 years when they see risks increasing.
State insurance regulators may approve rate changes but insurance company probably has well crafted reasons such as climate change. Regardless of the reason they can justify the changes requested.
One factor to consider is how GOOD the company is. Some have numerous complaints about pay-outs. So the cheapest isn’t necessarily the best. I would suggest looking online at consumer comments regarding hassles getting valid claims paid.
I’m with USAA. Not everyone is eligible for USAA, but if you are, they are relatively inexpensive, and pay out without hassles.
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The way person determines how GOOD a company is is not universal. But I feel confident in saying the two most important considerations are Premiums 7 Claims
It is easy to get in importance misaligned because we generally have few claims.
I have been paying insurance premiums for over 60 years. During the period I have had exactly 3 claims - one was actually my wife’s. Premiums in recent years are every 6 months. Back in the 60s and 70s premiums were annual events. Our 3 claims were:
A. An uninsured hit a line of 4 cars stopped because car #1 had a blowout. (new Porsche totaled - payout from uninsured motorist coverage for BlueBook value)
B. I was not looking as I left my drive and a neighbor was driving by. Cars touched. My car had a black rubber streak on the bumper removed it with car wax. My neighbor said she was in great pain from being thrown around her car and filed a law suit. Insurance Lawyer in local court for filings. I did not appear. A negotiated settlement paying the neighbor and her attorney $50K
C. Our house was burgled and we lost about $19K worth of contents - replacement value. It was not simple, but because a lot of our loses were electronics and that we replaced them, the electronics were not depreciated. Eventually we ended up with over $16K in cash payments.
For me, the ratings of an insurance company in the claim settlement process is the most important consideration.
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