What do Insurance Companies Pay for Anymore?
* * * WARNING RANT AHEAD * * *
I don't usually use my blog as a place to rant and rave. But something has been stewing in me lately and it felt really good to write it out here. So, I think I'll rant a bit more in the future. :-) I promise to warn you first.
Some good friends of mine had their house broken into last Thanksgiving. They did everything they were supposed to. They filed a police report. They filed a detailed claim to their insurance company. They are not wealthy people and it is believed that the thieves were interrupted by a neighbor returning their dog. As such, their total loss was only around $2000 but that can be a lot for we not wealthy people. They were then informed by their insurance company that they may want to rethink submitting a claim. Despite the fact that they had used this same company for many many years to insure their condo, they had owned the house for less than a year at this point. Their history started over with the new house. So, if they were to follow through with this claim, their insurance rates would go up over 40% for the next 4 years. This is well over the value of the items that were stolen.
I wonder what the point is with insurance on your house anymore?
After Katrina many many people have received nothing from their insurance companies because of the claim that water damaged their homes not the hurricane. Yeah..right... So, people who have lost practically everything are forced to sue and waste years and time and money to lawyers in order to get what they felt they were promised when they purchased the insurance. State Farm has been in trouble lately for it.
Also, do you know that insurance companies routinely use your credit score as the means of setting your insurance rates? Not just on home policies but on auto policies too. What does your credit score have to do with insurance? It makes no sense. Here is link that explains how they do that.
Many years ago, after some summer storm damage to our roof and fence we got an estimate for repairs and submitted it to our insurance agent. He gently recommended we find a way to pay for it ourselves. (We really do like our agent and feel he has helped us in the past, but the who system seems so corrupt now..) We learned later that even asking for an estimate can raise your rates. We ended up doing the repairs ourselves for much less than the $1500 we were quoted. We ended up making the decision because with our deductible we would have ended up paying for most it ourselves anyway. Then we learned how it could have really hurt us in the end.
I can't tell you the number of dings, dents and minor things we have dealt with ourselves rather than even consider bringing the insurance company into it. While this is all good and well because after all self reliance is a good thing. But lately I've seen some really good people getting screwed when they should be getting taken care of. Insurance should cost a lot less if it really is only going to pay for the complete burn down of your property.
So, unlike the years I saw my parents use their homeowners insurance to repair damage from storms and from theft, we no longer really have that option. For me, it is an inconvenience, for those effect by the hurricanes? It is life altering. For my friends? It is depressing and a temporary hardship. For the insurance company? I think I hear laughing from the great heights of their penthouse offices.
I don't usually use my blog as a place to rant and rave. But something has been stewing in me lately and it felt really good to write it out here. So, I think I'll rant a bit more in the future. :-) I promise to warn you first.
Some good friends of mine had their house broken into last Thanksgiving. They did everything they were supposed to. They filed a police report. They filed a detailed claim to their insurance company. They are not wealthy people and it is believed that the thieves were interrupted by a neighbor returning their dog. As such, their total loss was only around $2000 but that can be a lot for we not wealthy people. They were then informed by their insurance company that they may want to rethink submitting a claim. Despite the fact that they had used this same company for many many years to insure their condo, they had owned the house for less than a year at this point. Their history started over with the new house. So, if they were to follow through with this claim, their insurance rates would go up over 40% for the next 4 years. This is well over the value of the items that were stolen.
I wonder what the point is with insurance on your house anymore?
After Katrina many many people have received nothing from their insurance companies because of the claim that water damaged their homes not the hurricane. Yeah..right... So, people who have lost practically everything are forced to sue and waste years and time and money to lawyers in order to get what they felt they were promised when they purchased the insurance. State Farm has been in trouble lately for it.
Also, do you know that insurance companies routinely use your credit score as the means of setting your insurance rates? Not just on home policies but on auto policies too. What does your credit score have to do with insurance? It makes no sense. Here is link that explains how they do that.
Many years ago, after some summer storm damage to our roof and fence we got an estimate for repairs and submitted it to our insurance agent. He gently recommended we find a way to pay for it ourselves. (We really do like our agent and feel he has helped us in the past, but the who system seems so corrupt now..) We learned later that even asking for an estimate can raise your rates. We ended up doing the repairs ourselves for much less than the $1500 we were quoted. We ended up making the decision because with our deductible we would have ended up paying for most it ourselves anyway. Then we learned how it could have really hurt us in the end.
I can't tell you the number of dings, dents and minor things we have dealt with ourselves rather than even consider bringing the insurance company into it. While this is all good and well because after all self reliance is a good thing. But lately I've seen some really good people getting screwed when they should be getting taken care of. Insurance should cost a lot less if it really is only going to pay for the complete burn down of your property.
So, unlike the years I saw my parents use their homeowners insurance to repair damage from storms and from theft, we no longer really have that option. For me, it is an inconvenience, for those effect by the hurricanes? It is life altering. For my friends? It is depressing and a temporary hardship. For the insurance company? I think I hear laughing from the great heights of their penthouse offices.
5 Comments:
I hear you! Insurance today is a total scam! They will not hesitate to just cancel you if you make a claim, that happened to a friend of mine, and it was a large insurance company. It is totally ridiculous, and they fight you at every turn!
Yeah, when I trod upon my hearing aid this past summer, I learned that I should absorb the cost myself. It was cheaper than way.
I can relate. A few years ago we had a water claim with Allstate on our home. After everything was paid for and taken care of...Allstate informs us our Homeowners Insurance is going up from $1200 a year to $3500 a year! IF you can get them to actually pay a claim....they royally screw ya afterwards by sending your premiums through the roof!
Hear her.
I received a letter from our insurance company hinting at the same thing, make a claim and you are toast.
I phoned the head office and kicked up a stink. I received a letter of apology and an assurance my rates would not go up.
They have you by the short hairs.
I. hate. insurance.
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