Who Cares How Old My Roof Is?
When quoting a home, one of the first questions we ask is, "How old is your roof?" Often the response is, "Why does it matter?"
Why does it matter?
Roofing and foundation are the start and finish of your home. If one of them is damaged, the rest of the house is in danger as well. This is why insurance carriers are interested. If your roof is in poor shape, the chances of a claim are greater. Which is exactly what carriers want to avoid. Insurance is there to make you whole again in the case of a loss. But carriers do not want to have to pay claims. They will (if the loss is covered), but it costs them more money than you have paid them. So it isn't very cost effective for their bottom line. And trust me, while they are providing a very needed and valuable service, profit is a priority.
Why does it seem to be an issue in Texas?
In Texas, we have storms, many, many storms. Texas has the most volatile weather of any state. We have wind, hail, tornadoes, hurricanes, even a few earthquakes! Your roof is the first line of defense for a home during a storm. It is the first part damaged, which leads to damage for the rest of the home. It is a huge risk to insure.
Most carriers will send out inspectors to look at the home they are insuring. This is a business practice. They are not trying to find a reason to not insure your home. They are making sure your home is a risk they are willing to cover. Since they are the ones paying out thousands, possible hundreds of thousands, they do get to decide if they want to insure the risk. This inspection is not the same as the pre-sale inspection. I have seen the carrier inspection come back with a very different view of the home than the pre-sale inspection. The carrier's inspector results are the ones the carrier will use. The two inspections have different goals. The pre-sale inspector is there to evaluate the condition of the home for move in. The carrier's inspector is there to evaluate the RISK involved in insuring the home. The most common issues found are fences and the roof. Thankfully, most carriers will give the insured 30-45 days to get the issue fixed or find another insurance policy. But if you don't repair the issue, you will most likely run into the same problem with the next carrier.
Who decides if the risk is worth insuring?
Sometimes, we run into customers who want to debate whether the carrier is right or not. I want to get this point across to the consumers out there. You can argue all you want. But in the end, it is the carrier who will have to cover the cost of replacing your roof or any other claim. They have the final decision as to whether or not they want to insure a risk.
This can be so frustrating to both the insured and the agent. Our goal, as agents, is to keep you insured. Your goal, as consumers, is to stay insured. We both need the carriers if we are to maintain our goals. Since they set the rules and guidelines, we are subject to those rules and guidelines.
Who watches the carriers?
The carriers are not out there setting whatever limits and premiums they want. Insurance is one of the most regulated industries. Each state has a Department of Insurance that governs what the carriers can and cannot charge, cover and pay out. So again- you can debate all you want, but the rules and guidelines are set long before you buy your insurance. The gray area lies in the hands of the carrier as to whether they will insure a risk. Now, whether they will pay a claim once they have agreed to insure your home is a different story (and a different post).
When shopping for home insurance...
When you are shopping for home insurance, be honest with your agent. Tell him/her about your claims history and the age and condition of the home. This will help the agent place you in the correct policy from the start. Different carriers allow different levels of risk. Some will require a different deductible amount if your roof is over 10 years old. Some will require a higher deductible for an older roof. Give your agent all of the details so he can offer you the most suitable choices. And if you recieve a cancelation notice because of conditions of your home, take it seriously. Either get it fixed or get with your agent and see if he/she can find you a different policy!
Should They Stay or Should They Go?
I love trees. I climbed them as a child. I am amazed at their beauty as an adult. They serve a great purpose, both as something beautiful to admire and as a natural resource. Trees in a yard can make a house look fantastic. But trees can be dangerous to home. They need to be planted a certain distance from the home, depending on the tree and its root system. If you are planting a new tree or evaluating an existing tree in your yard, call an arborist. Do it right, or you can cause a major damage to your home's foundation.
Trees can cause foundation damage in 3 ways:
1. Physical contact with your foundation.
2. Affecting the moisture content of the soil under or near your foundation.
3. Causing air gaps and shifting soil due to decaying roots under or near a foundation.
Larger trees are a bigger concern with physical contact. Obviously, the larger the roots, the more damage may occur. The roots can extend more than 3 times the height of the tree. So if you have a 50 foot tree, it's roots may grow out to 150 feet away from the tree. The proximity of the tree to your house can make a huge difference. A good gauge is if your tree has limbs near or over your home, its roots are probably growing under your foundation. If you have a Pier and Beam foundation (usually found in older homes), this is less of a concern. Slab foundations sit on the soil and is more easily affected by root pressure.
Trees can affect the moisture content of the soil under and around your foundation. This is a concern if your foundation is "floating" on that soil (slab foundation). Trees transpire (draw in) water through their roots. And where are their roots? In the ground. If the tree is too close to your home, it is drawing moisture from the soil supporting your foundation and it will begin to recede. If you are not watering the entire perimeter of your home's foundation, it will recede much quicker. If you are not watering around your perimeter, the tree roots will look for water elsewhere. And the closest place for them to find it is under your home. They will grow out, looking for an adequate water supply. If you keep it watered and your trees are set the right distance away from your foundation, you are less likely to have foundation damage.
Tree Removal
If you have trees removed, make sure the entire root system is removed and the gap is filled in. If the roots are left, there will be gaps when they decay. Your soil will shift to fill those gaps, causing your foundation to shift. If your tree has many years of life left, it is often recommended to steer the roots away from the house, rather than remove the tree. If the tree is near the end of its life, removal is recommend.
Again- call an arborist when dealing with trees. There are lasting consequences of improper planting, maintenance and removal of trees. They are beautiful and a wonderful resource, but they must be maintained properly or they become a hazard for your home. Insurance carriers will not insure foundation repairs due to wear and tear. Letting a tree root system grow into your foundation is wear and tear. Not watering your foundation properly is wear and tear (and neglect!). As a homeowner, this is one of your responsibilities. Take good care of your foundation. It is the entire base your home rests upon!
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There are several different reports insurance carriers will run before thy will insure you. There are credit reports, claims history reports, payment history reports, violations reports. Home and Auto insurance carriers will both utilize these reports. This is the part where your history will affect your rates!
Can I Lie About My Driving History?
You can try, but it won't work. All carriers run your history reports before (or sometimes after) they write your policy. Most run the reports before they will bind the policy. Your reports largely determine your rates so they can be very significant in your pricing.
The CLUE report provides a 7 year history of claims associated with the driver/car. It will show the date of the loss, the type of loss, the amount paid out and the driver and car associated with the claim. Your agent can send you your CLUE report and you can dispute any claims that are on your report in error.
The Motor Vehicle Report (MVR) provides your driving history, your drivers license history (including suspension or cancellations), your traffic violations/citations and DUI convictions. The time frame of the MVR varies by state.
Why Home Insurance Reports?
Home insurance claims are filed less frequently than auto claims of course. They will be different than the auto reports, but what they are looking at is the same; your claims history.
Catastrophe claims shouldn't affect your rates too much. These include tornadoes, hurricanes, hail storms. The industry decides if it is a CAT claim once the estimated claims from the "storm" reach a certain amount.
Water Claims will affect your rates due to the price of repairs. It does not take long for water to cause expensive damage.
Liability claims will affect your rates. It shows a concerning lack of safety and upkeep at your home.
Negligence claims will cost you , you may have a hard time finding a carrier who will insure you at all. And again, you can lie or not disclose, but the carrier will run reports and the claims (and their circumstances) will be found.
Frequent claims filing will cost you in premium and by minimizing the number of carriers who will insure you. If you believe a claim should be filed, wait! Call out a certified contractor and get estimates! If you file a claim and it turns out the repairs will cost less than your deductible, the carrier will NOT pay out the claim. But you will still have the claim in your history.
Why Do Carriers Use These Reports?
Home and Auto insurance carriers use these reports to decide how great the risk is to insure you. The greater the risk (bad history), the higher the rates. So a clean driving or claims history will earn you better rates. Most carriers will look back 5 years.
Your claims history is very important to your rates. You can lie all you want. We have had people tell us they have not had any claims and then we find out they do. "Oh I forgot about that" seems to be the common retort. The reports will show your history, whether you have revealed it yourself or not and it will affect your rates. So be honest with your carrier for consistent rates. Carriers rate claims and violations differently, so where one carrier may choose to not insure you, another carrier may have decent rates for you. So don't lose heart and decide insurance is a luxury you cannot afford!
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Do you get frustrated by increasing insurance rates? The truth is, costs increase each year. And insurance is included.
Texas is the most volatile weather state in our country. We have hurricanes, hail storms, thunder storms, snow, flooding and even an occasional earthquake! Most states have one, maybe two, of these types of weather. But things are always bigger in Texas, so we have all of them. This volatile weather leads to the number one reason for insurance rate increases; Claims.
"But I didn't file a claim!" you cry in frustration on the phone to your agent. To which your agent may reply, "But your neighbors did." And then you shake your head and think to yourself (or out loud), "So I have to pay for their claims?" Yes, yes you do.
Why do I have to pay more?
Insurance companies are not repairing your damages for free. They are in it to make money (like every other company out there). Insurance is big business. And like every other type of company, if a carrier has more expenses (usually claims expenses) than they budgeted for, they will have to raise their rates to cover those expenses. So if there are major hail storms in January, chances are many carriers are going to have to raise rates to pay for those claims by year's end. So even if you didn't file a claim, but others did in your area, the carrier will most likely raise premium for everyone in the area to cover costs.
I hear the carriers try to keep from paying out claims.
Most of the carriers I have seen do try to take care of the customer in a fair and appropriate manner. Of course "fair and appropriate" means different things to different people. But what you might keep in mind is that the insurance carrier is the one taking the risk. If you had to pay someone $500,000, wouldn't you make pretty darn sure they are eligible recieve the money? I know would!
Whether it is $5,000 or $500,000, there are rules and guidelines to paying out claims. These are supposed to guide the carriers in evaluating what claims to pay and to what extent. There are some carriers who are being sued in a class action lawsuit by the state for not paying out eligible claims. So we know there are watchdogs out there looking out for the consumer. If you have a carrier who did not take care of you for an eligible claim, I am very sorry. And I urge you to call the Texas Department of Insurance (TDI) at 1-800-252-3439 and report them or file a complaint online. Make sure the company takes care of you!
Wrap Up
* So my point here is that claims are the #1 reason premiums are increasing almost every year. There is no way around that. All insurance carriers are not evil any more than all consumers are scam artists.
You can counteract increases by shopping around. (Another good reason to go with an independent agency!) When it is renewal time, we can re-shop the client if the premium has increased quite a bit. We don't guarantee a lower rate, but at least we can see if we can find something better for them. In today's world, there are many options available to you!
Have questions? Need a quote?
* Call us 877-987-8683
