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Coastal and flood prone insurance is rising in the US at a higher fixed rates the next couple of years because of federal policy changes that reduce the insuran

Coastal and flood prone insurance is rising in the US at a higher fixed rates the next couple of years because of federal policy changes that reduce the insurance cross-subsidy for riskier areas.

bombcar 4y ago
That must be why my earthquake carrier straight up dropped me.
nobleach 4y ago
This was my experience while living in Florida. Hurricane/Flood risks made it so there was no "shopping around". I had a house (built in the mid-60s) with a ton of tree cover. There was basically one company who'd even talk to me. I can't imagine what they'd charge me these days.
- KallDrexx 4y ago
  As a Florida resident, the florida situation is screwed but not because of hurricanes and flood risks. The problem is our laws about assignment of benefits and how insurance lawsuits get punished. So what happens is anytime any storm comes in you get swarmed with roofing companies wanting you to assign all benefits to them and they offer you a "free" roof. They then keep telling the roofing companies their previous estimate for roof was too low and they needed more money to fix the roof. At the end of the day the insurance companies end up paying double the cost of the roof because that's cheaper then the roofing company suing them, having to prove the costs they are being quoted are excessive, and if they fail they have to pay it out anyway + attorney fees. We saw this ourselves when we had a hail storm at our house and didn't know any better. We did the AOB to a roofing company. That company never even looked at the roof. They called the insurance company, who sent an adjuster who looked at the roof. The insurance company wrote us a $15k check for a replacement roof. 3 months later (when the roofing company hadn't even looked at our roof still, let alone given us an estimate) we get a notification from the insurance company that the roofing company told the insurance company it would cost an additional $8k, and the insurance company wrote them a check. We cancelled the roofing contract and shopped around. Got our new roof replaced within a month for $13k (we had 3 quotes from different companies, no company quoted more than $14k). This is why insurance is going up so much in Florida, and why insurance companies are leaving the state. Last I saw, Florida leads the country in insurance litigation cases per year by a ridiculously wide margin to the 2nd highest. And I'm not an insurance company defender or anything, but all home owners and renters in florida are all paying the price for this.
  - chadash 4y ago
    Last I checked, Florida has about 6% of the total US population, but more than 75% of property insurance litigation. The situation is insane.
  - cjrp 4y ago
    Why would the insurance company pay more than the adjuster's estimate? Isn't that the point of them sending a loss adjuster, to determine how much they should pay?
    - KallDrexx 4y ago
      When the adjuster comes out, the roof shingles are still there on the roof. No demolition has occurred yet. What happens is the roofing company claims to the insurance company that they had to replace more boards, they needed more nails, and a bunch of other material costs they claimed they needed. Since the policy states that the coverage warrants a replaced roof (of the same type) in this instance, the roofing company is claiming that a replacement roof costs more than the estimate and thus should be covered. The insurance company could send another adjuster out to verify that the replacement roof costs as much as they did, but they'd have to verify how many boards are replaced (which means going without a roof until the adjuster verifies all the damaged boards), material cost for the roof, etc... That's a lot of investigation they need to do to fight a supposed excessive cost when the laws of the state make it very hard (and costly) for the insurance companies to win a denial that gets litigated. It's not unusual for insurance companies to pay more than an adjuster's estimate though. An adjuster can't always see all the damage (they can't see behind walls, can't see under existing roof shingles, etc....) and if the policy covers fixing the damage then that means covering all costs it takes to fix that damage (minus deductible). So it's a balance between making sure insurance companies have the ability to push back against scamming of policies and consumer rights of making sure consumers get paid out what they are adaquately owed. Right now the balance in Florida is too far in the consumers favor and that's causing insurance companies to get scammed, and thus leaving the state, causing all consumers to ultimately suffer.
      - 4y ago
- leveraction 4y ago
  The situation is SC is similar. Many insurers have packed up for the same reasons they left Florida. The same roof repair scams have been running here as well. What I don't understand about the scam is how the insurance adjuster comes out and agrees that a new roof is warranted when so frequently that is not the case. If the adjusters kept the lid on things none of this would be possible I think. It's baffling, but in the end is bad for everyone (with the possible exceptions of the roofing companies) My house is not in a flood zone, but we definitely need insurance. (we actually have flood insurance despite not being in a flood zone.)

Coastal and flood prone insurance is rising in the US at a higher fixed rates the next couple of years because of federal policy changes that reduce the insurance cross-subsidy for riskier areas.

bombcar 4y ago

That must be why my earthquake carrier straight up dropped me.

nobleach 4y ago

This was my experience while living in Florida. Hurricane/Flood risks made it so there was no "shopping around". I had a house (built in the mid-60s) with a ton of tree cover. There was basically one company who'd even talk to me. I can't imagine what they'd charge me these days.

KallDrexx 4y ago
As a Florida resident, the florida situation is screwed but not because of hurricanes and flood risks. The problem is our laws about assignment of benefits and how insurance lawsuits get punished. So what happens is anytime any storm comes in you get swarmed with roofing companies wanting you to assign all benefits to them and they offer you a "free" roof. They then keep telling the roofing companies their previous estimate for roof was too low and they needed more money to fix the roof. At the end of the day the insurance companies end up paying double the cost of the roof because that's cheaper then the roofing company suing them, having to prove the costs they are being quoted are excessive, and if they fail they have to pay it out anyway + attorney fees. We saw this ourselves when we had a hail storm at our house and didn't know any better. We did the AOB to a roofing company. That company never even looked at the roof. They called the insurance company, who sent an adjuster who looked at the roof. The insurance company wrote us a $15k check for a replacement roof. 3 months later (when the roofing company hadn't even looked at our roof still, let alone given us an estimate) we get a notification from the insurance company that the roofing company told the insurance company it would cost an additional $8k, and the insurance company wrote them a check. We cancelled the roofing contract and shopped around. Got our new roof replaced within a month for $13k (we had 3 quotes from different companies, no company quoted more than $14k). This is why insurance is going up so much in Florida, and why insurance companies are leaving the state. Last I saw, Florida leads the country in insurance litigation cases per year by a ridiculously wide margin to the 2nd highest. And I'm not an insurance company defender or anything, but all home owners and renters in florida are all paying the price for this.
- chadash 4y ago
  Last I checked, Florida has about 6% of the total US population, but more than 75% of property insurance litigation. The situation is insane.
- cjrp 4y ago
  Why would the insurance company pay more than the adjuster's estimate? Isn't that the point of them sending a loss adjuster, to determine how much they should pay?
  - KallDrexx 4y ago
    When the adjuster comes out, the roof shingles are still there on the roof. No demolition has occurred yet. What happens is the roofing company claims to the insurance company that they had to replace more boards, they needed more nails, and a bunch of other material costs they claimed they needed. Since the policy states that the coverage warrants a replaced roof (of the same type) in this instance, the roofing company is claiming that a replacement roof costs more than the estimate and thus should be covered. The insurance company could send another adjuster out to verify that the replacement roof costs as much as they did, but they'd have to verify how many boards are replaced (which means going without a roof until the adjuster verifies all the damaged boards), material cost for the roof, etc... That's a lot of investigation they need to do to fight a supposed excessive cost when the laws of the state make it very hard (and costly) for the insurance companies to win a denial that gets litigated. It's not unusual for insurance companies to pay more than an adjuster's estimate though. An adjuster can't always see all the damage (they can't see behind walls, can't see under existing roof shingles, etc....) and if the policy covers fixing the damage then that means covering all costs it takes to fix that damage (minus deductible). So it's a balance between making sure insurance companies have the ability to push back against scamming of policies and consumer rights of making sure consumers get paid out what they are adaquately owed. Right now the balance in Florida is too far in the consumers favor and that's causing insurance companies to get scammed, and thus leaving the state, causing all consumers to ultimately suffer.
    - 4y ago
leveraction 4y ago
The situation is SC is similar. Many insurers have packed up for the same reasons they left Florida. The same roof repair scams have been running here as well. What I don't understand about the scam is how the insurance adjuster comes out and agrees that a new roof is warranted when so frequently that is not the case. If the adjusters kept the lid on things none of this would be possible I think. It's baffling, but in the end is bad for everyone (with the possible exceptions of the roofing companies) My house is not in a flood zone, but we definitely need insurance. (we actually have flood insurance despite not being in a flood zone.)