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Originally Posted by ThirdOfFive
Seems to be a relatively common thing. We just changed home insurance and had to put in a new hot water heater as the old one was installed the same time the house was built 1999). The insurance said we had to install a new one before they'd insure us. It dropped our annual insurance premium from approx. $4000 to less than $2000, so we had a net savings of about $800 plus a new water heater.
Can't really blame the insurance companies for what is happening though. They're obviously trying to cut down their risk as much as possible. Our agent said that something like 40% of home insurance claims involve water damage. So--yeah. Old roofs, old water heaters, bad siding, etc. can all be the root of claims. If the companies cut back their risks so that they can keep premiums status quo rather than increasing them as much as they have over the past 2-3 years, then I applaud what they're doing. Saves us all in the long run.
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I guess in the future, we will only be able to afford insurance on a new house. We'll live in it one a year, then buy a new one, and the old one will be demolished, to save the insurance companies from actually assuming any risk.
Waitaminit -- I thought the entire point of insurance was to assume risks.
Want to know the real reason most home insurance claims involve water damage? I guarantee its not because of hot water tanks in the garage. It's because we allowed builders to install plastic plumbing in our houses. Outlaw CPVC water pipes and water damage claims will go back to near zero -- like they were 30 years ago when we all had copper plumbing and 20-year-old roofs, and our yearly insurance payment was half a monthly house payment.