So tell us how you "demand the policy right for you" - are you saying you tell an insurance company how it is going to be and they comply?? Sorry but I am doubtful

I will not thet them determine a false replacement value on the house or overunsure it for one penny!!!

I've seen far more under-insured homes than over-insured ones.

People really don’t understand how replacement cost works. It’s nothing to do with appraised value or market value. The cost is based on worst case scenario say a fire total loss. What’s it going to take to tear house and slab out and then rebuild at today’s costs. Say 2000sq/ft hours. It’s going to be around 50k just to do demo and removal and then for just a standard house your looking at 200 sq/ft build back costs if you don’t have anything custom or high end like granite. So 2000 sq/ft house should be insured at minimum for $450k. The replacement costs aren’t some random number they come up with. I believe most companies use Marshall and Swift as the replacement cost estimate model. The sq/ft and interior and exterior features all go into finding correct replacement cost number.

Have to agree here. I also think $2k per home is being lenient.
How many commercials do you see for insurance.....it cannot be as bad as they want everyone to think.

I have my replacement cost at $133 perft, they wanted it at $266. I can get it built easily for that. Because I refused the higher deductible and replacement cost. It kept my insurance at bay. And I have had to be involved with this every year most months. Another example - I had a claim on a roof on a rental house which was the first claim in over 5 years. They raised the premium on all 12 rentals because it showed up on clues. BigPig listed a house in 2021 for me and suggested I go ahead and get a new roof which i did and paid $10,000 via check. 4 days later the roof was totaled with a hail storm. The little insurance program charged my deductible and $1,945 in depreciation. It took 6 weeks of hassle to get them to remove the depreciation. I just dont see insurance as a honerable business as they market themselves. You cant change my mind after a lifetime of bad experiences. And yes I always switch companies after they raise rates. My premium in 2022 and 2023 was $1,440 ish. I bet I move again this year!!!

Somes of you can think what you want - premiums have been going up. No doubt (none) about that. In 2022 the property & causalty industry lost in excess of $28 billion dollars and by the end of the 3rd quarter of 2023, it had lost another 36 billion dollars. State Farm just reported a 14 bilion dollar loss on its own. Markets are disintegrating and all we are seeing is more restrictive underwriting, less coverage and ever-increasing prices. Price increases on heavy property insurance related accounts (like home policies) are being hit the hardest.

Insurance is on the end of the inflation trail, something we used to refer as being spiraling inflation. Unless our leaders in DC start to address the issues so prevalent in our national economy and everyday lives, I fear it will only get worse.

Yeah and many folks think insurance companies are there for the good of man - truth is they are like any other corporation. The way they stay in business is to produce a profit. If they cannot do so then they bail out.

Some years back there were many insurance companies offering group and individual health insurance. They were getting killed on claims way beyond what their premiums were so guess what???

They did what any other corporation or business would do - they stopped selling those products. No different from what is going on now in the auto and HO business -

How does a company survive "losses" in the billions?

Short answer...reserves...which is income that is held back from being income when they need it for losses. They didn't lose billions...or they wouldn't be in business. Come on guys, don't piss in my ear and tell me it's raining.

Rest assured, insurance companies ain't "loosing" money year over year and still keeping their doors open. Goes back to logic and common sense again...people have none. The government is the only industry that can survive year over year "losses" and that's because they control the money.

So answer me this - why are companies pulling out of states - why are companies ceasing to offer health insurance? They are keeping their doors open by not making bad decisions. If YOU had built up savings/reserves and saw your income deteriorating would you just keep losing money?? I do not think so

Because the regulators won't allow them to work with the same margins they were working with before. Example, if I can't make 30%...I'm going to take my toys and go home...if enough of us do it, the regulators will bend. This is about the how big a boy are you situation.

Logic and common sense have nothing to do with how an insurance company operates. Agreed, insurance companies are required to establish loss reserves based on calculations done by actuaries. In addition to the loss reserves, the net worth of the insurance company, primarily retained earnings, is available to cover losses. The three components to a rate are operating costs, losses, and profit. Most large insurance companies operate at a combined ratio of over 100. For example if the combined ratio is 105, the company has paid out $1.05 for ever $1.00 taken in. Yes, they lose money purely on the insurance part of the business. The "profit" is made through investment income. If you doubt this, look at the annual reports for several of the largest insurance companies. There can come a point when premium income in a line of business is not sufficient to fund loss reserves to the point needed to continue writing that business. Homeowners in Texas is one of those lines for some insurance companies. And, many do not "keep the doors open". There has been a substantial consolidation in the insurance business the last 20 years with some of the major companies being acquired by other companies. The primary challenge is having to price the product without knowing the final cost of the product. I have bored you long enough. It is a tough business.

What?? That makes zero sense -

If you're paying $200/sqft for a builder grade home you are getting HOSED.

Ok then you tell me what the cost is to go build a 2000 sq/ft 3/2 house. I’m not talking track builders that save money by huge bulk ordering bc even when those houses burn down a home builder not Choice or Pulte rebuilds it.

Insurance companies can make a ton of money with a 2% margin. Never ever heard of any with a 30% margin - ever. I am glad somes brought up cash flows and reserves. Yes, an insurance company can make big $ with a negative underwriting result. Just not with the adverse negative results experienced in recent years. Seen some troubling declines in reserves, as in extremely disturbing. These same reserves will have to be built back up before the market regains any type of competitive edge.

For a couple of years now, our operation has been the leading profit center in the nation for a highly regarded billion dollar plus insurance company serving the commerical sector. During this crisis, they have taken little of my advice (very little). Even though this company has been earning money hand over fist here in lil' New Barnflies, we have periods where we get more non-renewals than renewals. Took over a $100,000 in business non-renewals just last week and all of it had been historically profitible. Babies are getting thrown out with the bath water.

Btw, the home and auto insurance market is in even worse shape.

Weekly insurance topic.

$133 per sq ft sounds like 2014 build rates

$250 per sq ft sound more in line with building a fairly nice house these days

I want mine over insured in case I burn it down

I don't find insurance that expensive for the amount of coverage you get.

And the amounts some of them spend on all those TV ads is probably a good indication of the size of those profits.

On line markets and direct writers (think State Farm, Allstate & Farmers) are more intensive with advertising than the indepenedent distibuton system which utilize commission earning agents to secure & place coverage appropriately.

Cost plus custom builders around here will build a house for $125-140/sqft. That's a custom home, level 2 granite, site built cabinets, engineered wood floors, minimal carpet, built-ins throughout. A 2000 sqft will be closer to $145 and a 4000sqft closer to $110.

New construction custom homes in the 2500sqft range on 3/4 acre lots are selling for about $185-205/sqft. Figure 6% in closing costs, $2/sqft for the land, $25k for well and septic, $15k for driveway and flatwork, $5k for landscaping..... that leaves about $150/sqft including builder profit.

If you're paying $200 for a builder grade home you are getting HOSED.

I think some of you are valuing the land in your price per sq foot. A moot point if rebuilding.

House are dirt cheap where you are at.

Here in Frisco for a average custom house around under 3,000 sq ft your looking around $250 sq ft new home

No way in hell you can find a new home above 4000 sq ft new build for $110, that is like 2000 prices

Site imporovements such as concrete flatwork, septics, wells, sewer/water taps and other things also not included.