Reciprocal Insurance

[RedChariot]

What is your take on this type of insurance. KIN, Loggerhead, Towerhill, just to name a few are in business about 5-6 years. They claim to have low premiums with equal coverage. How safe do you feel contracting with a company like this as opposed to a national company such as AAA, All State, State Farm etc.

Not to cloud the issue but I have read that most of us are underinsured regarding replacement value of our homes. If home is a total loss due to a lightning strike fire or hurricane, would your replacement value cover the cost to rebuild your home with all the upgraded surfaces etc you presently enjoy? Or are you only insured enough to replace the basic building? Lumber, Labor costs go up every year. Do you upgrade your policy periodically to reflect present day costs?

Your thoughts on both issues presented would be most appreciated.

Thank You

[RedChariot]

157 views, but no responses. I really was hoping for a discussion that would broaden my knowledge.

[tophcfa]

157 views, but no responses. I really was hoping for a discussion that would broaden my knowledge.

Add Slide to the list of names (taking on canceled Farmers policies). These companies concern me as they are not rated by AM Best, which is a reputable independent company that rates insurers financially stability and claims paying ability. Instead, they are rated by Demotech, a relatively obscure second rate rating agency. Also, these insurers are not large national companies with highly diversified books of business. That being said, Florida homeowners better start getting used to them. At the rate large and reputable insurers are pulling out of the state, it won’t be long before they are the only option. It’s becoming a real problem, the property and casualty insurance market in Florida is not in good shape.

[woolman44]

Loggerhead was being recommended by Progressive whose policies were not renewed.
When I called Loggerhead, I was told it was started by a group of ex Progressive people.
Supposedly they had insite that Progressive was going to limit their exposure to Florida because of all the claims they’ve encountered. Progressive had a much higher percentage of exposure in Florida than the other insurance companies. That’s why Progressive cancelled so many policies in Florida.

[JRcorvette]

What is your take on this type of insurance. KIN, Loggerhead, Towerhill, just to name a few are in business about 5-6 years. They claim to have low premiums with equal coverage. How safe do you feel contracting with a company like this as opposed to a national company such as AAA, All State, State Farm etc.

Not to cloud the issue but I have read that most of us are underinsured regarding replacement value of our homes. If home is a total loss due to a lightning strike fire or hurricane, would your replacement value cover the cost to rebuild your home with all the upgraded surfaces etc you presently enjoy? Or are you only insured enough to replace the basic building? Lumber, Labor costs go up every year. Do you upgrade your policy periodically to reflect present day costs?

Your thoughts on both issues presented would be most appreciated.

Thank You

That’s good question and you really have to decide is you want to save on premiums and risk a company going belly up or not. You are pretty safe as long as there is not a huge catastrophe even. Another issue might be customer service in the event of a claim.

As for the coverage part you really need to read and understand your policy. Very few agents will go over the policy with you in detail. I have found that the software they use to Value your home for insurance purposes falls short especially if you have major upgrades to your home. A few things to look for would be: Guaranteed Replacement Cost - Increase Cost of Construction as well as Increased Cost of Compliance (some policies will allow 125-150% over policy limits in the event of t total loss) - Debris Removal Costs in excess of policy limits. What are the Limitations and Exclusions!

Most people don’t look at their policy until they have a claim. There are many factors to consider when paying for HO insurance. Most people will never have a major loss claim but if you do you want a good company insuring you and pray that you get a good adjuster.

Retired 36 years handling claims.

[Babubhat]

If you have upgrades to your house that needs to be disclosed and paid for in your premium. Question any coverage you don’t agree with before finalizing the policy. The burden is on you.

The bottom line is you will not know how good your coverage is until you file a substantial claim. Small claims will increase your premiums and/or get your coverage non renewed.

As far as insolvency, this should cover it.
The Florida Insurance Guaranty Association establishes and maintains a service-oriented operation for processing covered claims of insolvent members. FIGA is a nonprofit corporation created by the Florida Legislature in 1970. FIGA services pending claims by or against Florida policyholders of member insurance companies which become insolvent and are ordered liquidated.

FIGA’s membership is composed of all Florida licensed direct writers of property or casualty insurance. Property and casualty insurers with a certificate of authority issued by the Florida Office of Insurance Regulation (OIR) are members of FIGA. In the event of insolvency, member company claims for covered lines of business are eligible for FIGA coverage.

[RedChariot]

Those of you that responded, I thank you. These are details I did not know. Back to the drawing board!:posting::posting: