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Hernando Today

Who Could Be Loyal To An Insurance Company?

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By RON RAE Guest Columnist

The Tampa Tribune

Published: June 11, 2008

Recently, I received a statement that forewarned me the yearly premium on my homeowner insurance policy would become due in July. At first, I thought it a little premature to send me the "renewal certificate," but the bottom line figure to cover the cost of repairs in the event of loss of property was something to be concerned about.

Alas, there is no monthly payment plan. The alternative is to put it on credit as I have done the past two years, as I have also done with property taxes. Sound familiar?

The only positive comment I can make is that the premium is but a few dollars more than the figure in 2007. My worst fear proved unwarranted; the 30 percent increase I had seen from 2006 to 2007 didn't happen again.

Thank you very much, Governor Crist, for keeping my rates from going down (sic) as you had promised. Insurance companies not only reduced their risk by canceling policies along Florida coastlines, but also kept their practice of profitability.

There is an increase of $22 but also a premium rate decrease of $35, which is good news of little importance. If not for a reduction in the assessment for Citizens Property Insurance losses of $80.52, I would have an overall increase. How generous that this comes as a gift "due to an appropriation by the Florida Legislature"!

No one can predict what the cost in assessment fees will be with the shortfall of funds for Citizens claims when the next big hurricane demolishes any portion of Florida. Last year it was 7.2percent of the bill, now 2.5 percent (and 1 percent of my auto insurance premium). We are all still paying for the 2005 hurricane season. The next one may warrant a surcharge well into the next millennium.

So, I had to hawk-eye the line-by-line charges to see what my payment covers. Most of it was pretty straightforward but, since the balance due was going to dampen my summer, come rain or shine, I finally contacted the agent just last week for a little clarification.

Not much can be done but to save what amounted to a few dollars, although I questioned the personal property loss coverage, which covers the belongings inside the home. She explained the standard figure is 75 percent of the dwelling coverage. She informed me it could be adjusted to 50 percent, or as low as 25 percent. She had no immediate formula to quote the savings but she would get back to me.

Of her own accord, she explained how I could cut the bill in half if I were to limit sinkhole coverage strictly to "loss of use," which means if there were cracks in the foundation but not to such a degree as to condemn the structure, I would be on my own. A tempting idea, but much too risky in Hernando County. Not so for the insurance company; actuaries make sure a profit is to be made.

So now I await an e-mail from Lisa on what minuscule savings I might realize with a reduction in personal property coverage.

I also await a call from Hector, an agent of an insurance company that still accepts applications from Hernando County homeowners, to find out how he can assist me in keeping my home a safe, and less expensive, place to live. The initial figures indicate I can save almost $200 per year; $600 if I tweak up the deductible. But he advised me he is required to quote the rate Citizens would charge as a comparison. I wait with anxiety.

All said I cannot afford loyalty to my current insurance company. Besides, who needs a company whose name suggests it specializes in farms? Perhaps I'll go with the one that boasts a triple-A rating?

Ron Rae, who worked for 25 years in the telecommunications industry, lives in Spring Hill and can be contacted at hernandoron@yahoo.com

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