Homeowner's insurance deductible

[Nelso]

I received my homeowners insurance renewal in the mail yesterday. With the recent storms in the area, I thought I should refamiliarize myself with the policy. I have a special deductible in there related to wind and hail damage. The deductible is 1% of the insured value. I remember my insurance agent telling me a number of years ago that was becoming the standard for insurance companies and that I didn't have a choice on a lower deductible. My deductible for any other loss, other than wind and hail is $750. Does anybody know if this 1% deductible is an industry standard?

[BoxMN]

Not for mine, but I don't have one of those megga houses either, so it might be due to a specific value of the home. My brother has a big house (to me) and his is 1% as well. Though I do carry a $2k deductable by choice.

[Flatlander]

It's becoming more common. Doesn't matter the size of the house. USAA insurance has been 1% for wind and hail statewide for a number of years now.

[Eric Wettschreck]

I've had the same insurance company, agent, and policy for ever. This post made me look at my policy and call my agent.

For me, hail and wind is the same deductable as everything else. I guess it pays to stay with the same place for a long time.

[Sandmannd]

Wow, that's a new insurance scam. Nice how they have no problem taking your money every month, but when it's time to pay they find every trick to get out of it.

[harvey lee]

I have the same also for wind and hail as my other deductable. No difference for me.

[Roofer]

It's not a scam, even though it appears that way. 1% is normal for more expensive homes, normally over 500,000. You can't have a $250, 500, or even 1000 deductible on a house that is that expensive.

[Roofer]

Believe me, insurance companies are paying....

It's the homeowners scamming right now, wanting to get low bids and pocketing cash from their ins. claims.

[Nelso]

Our home's value is a little above average metro price, which is well below 500K. I was just curious to what others were paying for a deductible. I realize the insurance companies are paying out large sums of money for wind and hail damage and they need a way to curtail the homeowners and roofers from submitting marginal claims. I just thought when all my neighbors were getting new roofs more so because the roofs had reached the end of their usefuls life, rather than from any significant hail storm and not having to pay a dime, I had to be missing something.

[Flatlander]

Wow, that's a new insurance scam. Nice how they have no problem taking your money every month, but when it's time to pay they find every trick to get out of it.

The real B.S. is happening down south. I was on a roof today with an IA from Pensacola, FL. He's been "in good hands" for 16 years, with 1 claim in 94', and he received his letter about 2 weeks ago. As of Oct. 1st, no one south of Hwy. 90(I think that's the hwy he said), will be "In Good Hands". One claim, 16 years of premiums and poof....no policies written anymore and existing policies no longer good. That's a bunch of garbage.

[Coach1310]

They may be paying now...... but they make their $$$ 95% of the time and pay out the other 5%. There is no shortage of profits with the insurance companies. I guess I don't see it as "scamming". The insurance company gives you $10,000 because they think that is what it will take you to repair all the damage. You find someone(who will do a good job and that you truse) to do it for $8,000. Sounds like good consumer practice to me. You won't get me feeling bad for the insurance companies.

[Roofer]

The insurance company gives you $10,000 because they think that is what it will take you to repair all the damage. You find someone(who will do a good job and that you truse) to do it for $8,000. Sounds like good consumer practice to me. You won't get me feeling bad for the insurance companies.

Sounds like Grand Theft to me. That is unethical, just plain wrong, and possibly illegal.

[echotrail]

I've made 3 claims in 32 years, each with a different company but I was never given a check from the insurance company and allowed to make repairs without confirmation. They required a licensed contractor bid and would pay about 50% of the cost and made a final payment when the job was finished. Checks have always been made out to both me and the contractor. How do some of you get the payment without confirmation of the job being finished?

[harvey lee]

Roofer, I may also be a crook if thats what some consider. I had a huge claim a few years back when I had approx $40,000 in damage. The adjuster came out and this is what they paid. I found some kids to tear the shingles of one roof and I saved a few bucks and the kids also made some. I also did plenty of the work myself.

If my policy states that the house will be fixed and they send me the check, doesn't seem wrong to me if I can make a buck or two. The buildings were repaired to a better state than before they were hit by the straight line winds.

[Sandmannd]

Roofer, I may also be a crook if thats what some consider. I had a huge claim a few years back when I had approx $40,000 in damage. The adjuster came out and this is what they paid. I found some kids to tear the shingles of one roof and I saved a few bucks and the kids also made some. I also did plenty of the work myself.

If my policy states that the house will be fixed and they send me the check, doesn't seem wrong to me if I can make a buck or two. The buildings were repaired to a better state than before they were hit by the straight line winds.

I agree with you Harvey. If it's that much to fix it and they write the check and you can do the work yourself, well you just got paid for your time same as a roofer would have. Nothing wrong with that IMO.

[Roofer]

Do you think it was legal having kids on your house with no insurance? All roofer's in MN are required to have a state license and insurance. That is why a Roofer deserves more money than a homeowner doing their own roof. We have overhead. Do you really think you have as good of a roof as you could have had? Or maybe it doesn't matter to you..........

People think an insurance check is their own personal bank account and that isn't true. That money is issued to have something repaired professionally on your home. Sure there are plenty who skimp by cheaper and some who just pocket the whole thing and do nothing. I even have some relatives like that. But, when the insurance companies start checking into this, you are on the hook. I have seen houses sold and the previous owner had to come back and pay current prices to have things fixed that they got payed for and never done. We have even had people forge our company name to cash an insurance check. then we get questioned about the roof or siding we never even did.

Honesty will go much farther than being a cheap skate to pocket a few dollars. Believe me, I know because as already mentioned, I have some cheap skates in my own family. I just shake my head because they should know better by the stories I tell them about others cheating out.

[BoxMN]

I built my own garage, and did the roof myself, and I remember doing my Dad's roof as a kid. It was great learning, and saved some bucks. But after last year's hail in August, I had a licensed guy come (though they had a Mexican crew...) and do my roof on house. They did a GREAT job, did it in one day with good cleanup.

Friends said why pay to have someone do it, do it yourself... but all it takes is for me to fall off and loose work and medical bills, or a friend to fall off and get hurt, or take too long and have rain hit. At my point in life it just isn't worth trying to save a few bucks but with risks.

We had insurance money to do it with, and as long as it gets fixed they are happy with it. BUT, you can ethically and legally search for the right price and possibly get even more work done for the same $$. That is what we did, and it worked out great. You can be an honest cheapskate (meaning good shopper) and come out ahead as well

Good info in this thread. And I am not against anyone doing it themselves, just depends upon what they/we/you are comfortable doing.

[Roofer]

You come out ahead getting everything replaced for free or almost free. That isn't good enough?

You are saying a Contractor should slash his prices just to get a job that a homeowner doesn't even have to pay for?

[Coach1310]

So in other words, I should hand the check to the contractor and say, "Well the insurance company is giving me $10k, so if you can do it for that the job is yours." Then again, if the contractors bid is $8900, I'm sure you will make sure I get the extra $1100..... there is no way you bid will be right around the $10000 mark just by chance! The $$$ the insurance company is giving me is $$$ I paid to them in the first place for their coverage. I am sure they will offer to give me some $$$ back after 30 years with no claims, right?

I'm the crook because I can find people to do the work for less than the insurance company gave me. Isn't there some fault in the insurance company paying out more $$$ than the job requires??

Don't get me wrong, I am sure many contractors do great work and are in it to make some money, but keep the consumers best interest in mind at the same time. However, just because a contractor did it, doesn't mean it is a better job than someone who isn't.

**Not saying anyone should slash prices, but if the bid is under the amount the insurance company provides, that doesn't mean I am a crook. I am sure no contractors prices happen to go up a little when insurance claims are involved**

[Roofer]

You are supposed to have a contractor that you trust to do the job. They should go over the paper work with you to make sure the insurance company is covering what you have damaged. Most go by computer software now, so contractor's know what things cost and current rates. This puts everyone involved on the same page, so things are fixed or repaired correctly. I have estimates that are within a few dollars of what the insurance company pays, but also have found many that have mistakes.

If you have noticed, most insurance claim checks come with a contractor's name or a mortgage company's name. They have to make sure this work is completed to mortgage your home and insure your home.

As for hiring kids.....imagine one of them falling and breaking his neck (life long injury). Would you want to pay for that? Would you want that over your head?

I sent an email to a news channel and they are contacting other experts about this kind of activity with storm damage and insurance claims. I'm waiting to see what happens.

[Roofer]

BTW, if you look through your insurance claim papers or contact your agent, if you get repairs done under the claim amount, the extra money is to be sent back to the insurance company.

Explain to me how a homeowner is entitled to this money?

How is this different from a doctor's bill?

[Coach1310]

I understand that usually someone has to sign off(my mortgage company signed off on mine last fall), but I am a little confused. I'm not saying everyone should try to rip off the insurance company, but if you can get a bid to do the work for less than what was projected I don't see anything wrong with that. Say you bid a job and you incorporate 20 hours of labor in the bid price. You only work 14 hours and get the job done. Do you rebate the homeowner for those 6 hours you charged them in the price, that you didn't need to work? Just curious why it is such an issue...

[Coach1310]

The biggest difference is you don't get the $$$ upfront for a doctor's visit/bill. The bill is sent to the insurance company, who processes it and then sends you a summary of costs and tells you what you owe. I think the big issue you are missing is the INSURANCE COMPANIES are the one dropping the ball here, not the consumer. Their procedure is flawed. If they are okay with sending you the check and the mortgage company signs off on the work, the issue isn't with the consumer it is with their claims process. The reason it isn't a big deal with them is because they make TONS OF $$$$ regardless. The extra effort, time or employees they would have to have isn't worth the $$$.

As far as "Why I feel entitled to the $$$".... first off I don't feel entitled, but I pay my premium each year for my coverage. Something happens and I need to file a claim. I do so, they send out their adjuster or whatever he/she is called and they determine I get X amount of dollars. I get the work done which is signed off on by my lender. I didn't deceive anyone. I did all the work or got all the work done that was in the claim. All the issues are fixed, the claim is closed the process starts over again.

[harvey lee]

Roofer, my insurance company knew exactly what went down and din't care. They told me if I could do some of the work and save money over what the bid was, then fine.

Thats exactly what I did and they didn't care. You must have some different insurance company covering you.

[Roofer]

I agree with you that their system is flawed. This will change because people took advantage of it. Sooner or later, everyone will have a higher deductible and have to pay it.

We are just hurting ourselves as consumers.

Insurance companies are closing up all over the state because of these claims, but I think it is their own fault because they sold insurance as "replacement cost".