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Not sure where you live but I'm guessing you had to Google that info yourself.
Half right. Yes, I searched for this, but not because I had to. Rather, I searched because I often check data before I post. My recollection is that I was offered a policy with a 25% deductible. But that was long enough ago that I wasn't sure about the figure and I don't have records going back that far.
This may be a digression but how many of you Californians have earthquake insurance? (I do not and none of my friends and family do - may be we are all asking for trouble!)
P.S.: @larryB, I checked with all my extended family members and reached an unscientific conclusion that home insurance premiums also depend on zip codes (i.e., Rich vs Poor).
@ MikeM. Material might be similar cost in different regions but labor surely is higher here. So the cost of rebuilding a 2,000 square foot home will cost more in a high labor state.
The zip code has labor cost built into the rates. Here in Sacramento there are many zip codes that have very mixed demographics. So it’s not necessarily rich vs poor. My own zip code has some very exclusive areas and pretty crummy and rougher neighborhoods. One zip code has some of the highest income inequality in California.
With respect to insurance deductibles, consider why a deductible of, say, 5k vs 100k likely isn't going to change the policy rate that much.
A home is insured for $1 million. If that home is destroyed by fire: • At 5k, the insurance company is on the hook for $995,000 • At 100k, the insurance company is on still the hook for $900,000
It's that big number that's controlling this relationship, not the small one. From the insurance company's perspective the only benefit for the deductible is to relieve them from the processing of potential nickel-and-dime claims.
Add:
It's a different animal with earthquake- unlike a fire, which can easily total a structure, an earthquake, depending on the structure and many other variables such as EQ intensity, the ground conditions under the structure, etc. can cause greatly varying damage to a structure, which many times is repairable, though expensive. Here, it makes sense to have a large deductible, as the insurance may greatly limit it's exposure that way.
@larryB, Zip Codes or some other geographical segmentation probably also determine crime and potential for damage. No? Housing density may also be an issue for the potential for large scale damage per sq ft covered.
Location also could cause the insurance company to think if the people living there live more responsibly or not - of course, they will use statistics and not guess. At least that is how I explained to myself about differences in auto and health insurance based on location (zip codes).
It is too bad we do not have any insiders to tell us the secret sauce Ins Cos use to determine premiums and I am just spit balling.
@Roy - that's great- good for you. Out here in CA we're lucky to find insurance at all. And on top of all of your coverages we have to worry about earthquake also.
For many years now we have used Costco's American Family Connect for all three types of coverage, umbrella through some subsidiary. While I often feel I should shop around and compare premiums in detail, I've been very happy with their cost, their service, and their payouts. Even or especially when on "opposite" sides now, as I got hit by a car in January in our no-fault state and so AmFam, which is in Wisconsin, is among the insurers "paying" me and covering the v large medical expenses, approaching $200k. (Medicare rightly attaches some of the payout, being public moneys.)
I have my car insurance through AmFam for sometime and I do not shop around. Many, many years ago when I took their auto insurance, they were quite expensive for home insurance but they no longer underwrite home insurance in my State, at least not new policies. They have good customer satisfaction scores.
Quick question - Do umbrella policy underwriters require you to account for your net-worth and, more specifically, your financial holdings, when applying for coverage? A lot of it is probably public record and easily verifiable (like home, auto, real estate ownership). But some of one’s wealth (like funds / securities held) are not public record / public knowledge - at least as I understand it. But I may be wrong.
Thanks @davidrmoran for the heads-up re Costco. Happy member.
No, maybe if you apply for a very high dollar policy. I did have to have a certain level of auto coverage beforehand. I.E. I couldn't have the minimum required by law
@MikeM - Why would they? I was (incorrectly) equating umbrella coverage to homeowners or auto collision coverage. In those cases an insurer won’t insure what you can’t substantiate you own.
I sense from the responses that medical insurance is perhaps the better comparison. In that instance a cap is applied. But it is not known in advance exactly what treatment will be administered or at what cost.
@hank - No sir- we've had this coverage with at least four different companies over the years and that has never come up. As Yogi mentioned though, it's a add-on requiring another underlying policy.
Thanks all. Didn’t intend to entrap Mike. Small local agency. Good service. They shop out the best companies for me. Just want to maintain privacy. Shouldn’t be a problem adding on.
I’ve read online activity (ie critical remarks about a business) can sometimes result in lawsuits. That, plus biking, plus a substantial amount of real estate have me convinced.
You can't buy life insurance for some random person off the street - that invites fraud and homicide. Rather, there must be some economic interest you are insuring. Studios may insure their actors because the studios have money on the line. The most obvious candidate for life insurance is a family wage earner. A family stands to suffer if a wage earner dies.
Similarly, insurance companies are not likely to sell you liability insurance for more than you have at risk. I have a vague recollection of asking an insurance company out of curiosity about umbrella policies over $5M, since that seems to be the limit for "no questions asked" policies.
I emailed the agent for more information on our Chubb excess liability policy. She emailed back with a Chubb PDF "Understanding The Cost and Value of Your Personal Excess Liability Policy". She commented that Chubb's excess liability policy acts like other carriers umbrella policies.
One of the sales pitches in the brochure says "We offer some of the highest excess liability ("umbrella") limits available."
On the page "Chubb's Masterpiece Excess Liability Coverage" it lists:
- Worldwide coverage - Liability protection for libel and slander
It does seem that Chubb's excess liability coverage policy is in fact what I would think of as an umbrella policy.
@BaluBalu, I do not. My experience is that they are not the low-cost provider, but they are quite accommodating. For example, my neighbor also has Chubb and while they are not married, Chubb named both on their homeowners' and excess liability policy. A downside to some is that you have to go through an independent agent to get Chubb insurance. We go through a large broker who seems to have Chubb's ear.
I am not looking for the lowest premium provider. I already have a 20% lower quote from a different company than my current insurer (increased YOY premium by >50%) but my current insurer has marginally better customer satisfaction score and so, I am still shopping for an equivalent or better customer satisfaction score and potentially lower premium than my current one. I am hoping never to make a claim but when I have to, it has to be available with least amount of friction. I do not want to get into an agreement just looking at my rights and thinking I can always assert my rights or sue to compel performance.
I can report this re Chubb: A couple of years ago my Toyota Tacoma was parked and a woman (somewhat under the influence of something or other) took out a rear fender while attempting to park behind me. She had Chub and they paid quickly and in full on one estimate.
Frankenmuth is a small Michigan based insurer. Also does business in Ohio. Been with them forever.
Long story short …. Rented car totaled while waiting for a red light to change in Florida 15 years ago. “No-fault” state. When the steeply padded bill from Budget arrived a few weeks later insurer settled with them fully. To this day I avoid buying expensive rental insurance.
Auto insurance rates: As most of you are aware, the 'high tech' in autos/trucks adds a large dollar cost to repairs or determining whether a vehicle is 'totaled' after a collision. This article link provides a small overview of repair cost changes.
ADD: A neighbor had very small cosmetic damage to a front fender and headlight assy. on a 2023 Chevy Silverado truck. This was from a co-worker backing into his truck at a parking lot and was paid for by the co-workers insurance. The repair cost was $1,250. The cost may be higher for more damage. From an online check: Replacing the entire headlight assembly can cost as little as $30, rising to upwards of $4,000 for the parts, depending on the make and model of your vehicle. NOTE: When you're thinking about adding another/different vehicle to your policy; the insurance company can provide a reasonable quote from the VIN number. 'The VIN number tells you when and where the car was built. It tells you the manufacturer, year, make and model, and the trim level including unique features and specifications. Your car's VIN number can be used to track recalls, registrations, warranty claims, thefts and insurance coverage.'
Comments
Half right. Yes, I searched for this, but not because I had to. Rather, I searched because I often check data before I post. My recollection is that I was offered a policy with a 25% deductible. But that was long enough ago that I wasn't sure about the figure and I don't have records going back that far.
The deductibles in California are generally 15%, 20%, and 25%.
https://www.earthquakeauthority.com/california-earthquake-insurance-policies/homeowners/coverages-and-deductibles
They don't depend on risk. You get to choose. "For the best choice of CEA earthquake home insurance policies, select deductibles from 5%-25%."
https://www.earthquakeauthority.com/california-earthquake-insurance-policies/how-to-buy-earthquake-insurance-california
P.S.: @larryB, I checked with all my extended family members and reached an unscientific conclusion that home insurance premiums also depend on zip codes (i.e., Rich vs Poor).
A home is insured for $1 million. If that home is destroyed by fire:
• At 5k, the insurance company is on the hook for $995,000
• At 100k, the insurance company is on still the hook for $900,000
It's that big number that's controlling this relationship, not the small one. From the insurance company's perspective the only benefit for the deductible is to relieve them from the processing of potential nickel-and-dime claims.
Add:
It's a different animal with earthquake- unlike a fire, which can easily total a structure, an earthquake, depending on the structure and many other variables such as EQ intensity, the ground conditions under the structure, etc. can cause greatly varying damage to a structure, which many times is repairable, though expensive. Here, it makes sense to have a large deductible, as the insurance may greatly limit it's exposure that way.
Location also could cause the insurance company to think if the people living there live more responsibly or not - of course, they will use statistics and not guess. At least that is how I explained to myself about differences in auto and health insurance based on location (zip codes).
It is too bad we do not have any insiders to tell us the secret sauce Ins Cos use to determine premiums and I am just spit balling.
i hope you recover soon.
I have my car insurance through AmFam for sometime and I do not shop around. Many, many years ago when I took their auto insurance, they were quite expensive for home insurance but they no longer underwrite home insurance in my State, at least not new policies. They have good customer satisfaction scores.
Thanks @davidrmoran for the heads-up re Costco. Happy member.
I sense from the responses that medical insurance is perhaps the better comparison. In that instance a cap is applied. But it is not known in advance exactly what treatment will be administered or at what cost.
Also agree with what yogi said. I was told by our insurance agent the umbrella pays after either the auto or home owners liability is maxed out.
I’ve read online activity (ie critical remarks about a business) can sometimes result in lawsuits. That, plus biking, plus a substantial amount of real estate have me convinced.
Similarly, insurance companies are not likely to sell you liability insurance for more than you have at risk. I have a vague recollection of asking an insurance company out of curiosity about umbrella policies over $5M, since that seems to be the limit for "no questions asked" policies.
One of the sales pitches in the brochure says "We offer some of the highest excess liability ("umbrella") limits available."
On the page "Chubb's Masterpiece Excess Liability Coverage" it lists:
- Worldwide coverage
- Liability protection for libel and slander
It does seem that Chubb's excess liability coverage policy is in fact what I would think of as an umbrella policy.
I am not looking for the lowest premium provider. I already have a 20% lower quote from a different company than my current insurer (increased YOY premium by >50%) but my current insurer has marginally better customer satisfaction score and so, I am still shopping for an equivalent or better customer satisfaction score and potentially lower premium than my current one. I am hoping never to make a claim but when I have to, it has to be available with least amount of friction. I do not want to get into an agreement just looking at my rights and thinking I can always assert my rights or sue to compel performance.
Long story short …. Rented car totaled while waiting for a red light to change in Florida 15 years ago. “No-fault” state. When the steeply padded bill from Budget arrived a few weeks later insurer settled with them fully. To this day I avoid buying expensive rental insurance.
This article link provides a small overview of repair cost changes.
ADD: A neighbor had very small cosmetic damage to a front fender and headlight assy. on a 2023 Chevy Silverado truck. This was from a co-worker backing into his truck at a parking lot and was paid for by the co-workers insurance. The repair cost was $1,250.
The cost may be higher for more damage. From an online check: Replacing the entire headlight assembly can cost as little as $30, rising to upwards of $4,000 for the parts, depending on the make and model of your vehicle.
NOTE: When you're thinking about adding another/different vehicle to your policy; the insurance company can provide a reasonable quote from the VIN number.
'The VIN number tells you when and where the car was built. It tells you the manufacturer, year, make and model, and the trim level including unique features and specifications. Your car's VIN number can be used to track recalls, registrations, warranty claims, thefts and insurance coverage.'