Its "cheap" insurance

[Brute 23]

It use to be, at least. I think they may have finally over played their hand.

I had been hearing quite a bit of rumbling from people about dropping insurances. I know I dropped full coverage on a couple $10K kind of vehicles we have. They were want $2-3K a year for full coverage, each. It's not worth it in my opinion when I can get liability only for like $1K.

Some guys I was sitting with over the weekend were all talking about dropping insurance policies. These guys have multimillion dollar homes, families with 5 or 6 new vehicles. They are saying they will just save their premiums in accounts and take their chances. One was talking about how he has purposely started paying cash just so he can put liability on it. Between saving the finance costs and insurance, plus the hassel, he said he is liking it.

It's interesting. With money market and savings accounts bringing 5% its definitely an option. For some one, with decent amounts of cash invested, like if you are retired, that may never get touched, think how much annual cash flow it would free up.

Of course there are certain areas that are more prone to issues But then again the insurance is probably adjusted accordingly.

Any one doing it here? It seems like it is becoming more and more expensive to not have cash available.

 

[Silver]

I dropped insurance on one house, considering dropping it on the one we live in when the mortgage is done next year. Between the two houses it would free up almost $7k per year. The insurance companies are pricing themselves out of the market for sure.
I can take that savings and earn money on it, and still have the principle. I do understand that if I burn a house down it will be a setback but everything is a gamble.

 

[Ky hills]

Our insurance keeps going up, and a few years ago we decided to take a gamble and lower our insurance coverage.
Had an old tenant house built back in the 1800's had periodically had improvements done. Within a few months of lowering the insurance, the tenant was throwing cigarettes down in a potted plant on the porch. It ignited and quickly burned the house beyond feasible repair. Now we are without that income from the rent and the demolition and disposal of what was left of the house took a large portion of the insurance money.
Moral of our story is we went back and raised coverage on a few things on our policy.
I have known an older man in the county, who never took out insurance on anything except what he was required to like vehicles.
He said you are betting on something happening and insurance companies are betting on it not.
Either way it's money lost and I see points to both but when you've been hit with something it can be a big loss to try to recoup from.

 

[Lucky]

Lots of guys that have houses and equipment paid for are talking about dropping insurance. To drop auto insurance you'd need a sizable amount set aside I believe.

Our insurance is $900 a month to cover everything we own. Took me 30 yrs to get it all paid for and I'd sure hate to start back at square 1 because of a fire or tornado. We had a F4 come through 2 years ago, the wife watched it go past our house about 3/4 mile away. Lots of people we know were affected by it. A few we know lost everything and didn't have insurance updated to cover the cost. Imagine losing your house, hay barn, horse barn, shop, fences, equipment, and everything that was in them in 15 minutes. That's what happened to a few of these folks and they got 300-400k to rebuild everything. You'd be lucky to build a 1,800 house and furnish it for 300k these days. For context we built a hay barn for $40k 6 yrs ago and they want $90k to build one like it now. Mighty risky to go without insurance, unless of course you just have more money than you can spend. It's definitely tempting though.

 

[Dsth]

I removed insurance on some of my older buildings and much of my older equipment. increased the insurance on the house and things in it with the premium savings. the insurance companies base their premiums on % of customers having a $ value loss. in the end, they do not plan on losing money, so if you can afford to replace what you need to in case something bad happens, odds are that you will save money without the insurance. that is just my opinion.

 

[Brute 23]

I removed insurance on some of my older buildings and much of my older equipment. increased the insurance on the house and things in it with the premium savings. the insurance companies base their premiums on % of customers having a $ value loss. in the end, they do not plan on losing money, so if you can afford to replace what you need to in case something bad happens, odds are that you will save money without the insurance. that is just my opinion.

Exactly.

They have been collecting a lot of premiums from people insuring a lot of items for many of years. These guys I was with might pay 100K or more in insurance a year. My brother is over 50 I think.

If a large portion of these people that can afford it drop them, I wonder where that puts companies, and ultimately the people still using insurance, long term?

 

[Brute 23]

The fact that a lot of the companies have gotten so shady is not helping either.

Like my dad having to sue his auto company after years and years and they didn't even have an argument against him. They just dragged it out and paid some local attorney to basically show up. They didn't even really question any thing.

His own company just wanted him to feel the hassel of trying to get his own money out of them.

 

[chevytaHOE5674]

All my vehicles just have liability, no sense in paying big bucks for full coverage when the vehicle is 10 years old and not worth much.

I have a lot of equipment insured for agreed value and honestly I find the premium very reasonable and unless it changes drastically I won't be dropping it.

 

[Dave]

I just have liability on all the vehicles. I would like to drop the medicare supplement but that would be too risky. But I am going to shop around. It has gone up 60% in 7 years.

 

[fnfarms1]

Ours went up considerably this last year. We use AFR here in Oklahoma. Shopped around, no one cheaper. Went from 2600/yr on farm, hay, cows, and equipment. 1mil liability. To 3900/yr. Everything's paid off equipment wise but tractor books at 37k, I don't have that to replace it and it's like 500/yr. I'll keep that. Trucks are tough their about same as tractor. I think their 1800/yr for full coverage together, cheap is lose one next year.

 

[farmerjan]

I just have liability on all the vehicles. I would like to drop the medicare supplement but that would be too risky. But I am going to shop around. It has gone up 60% in 7 years.

If your health is good, check into the Medicare Advantage programs. I have been told that there are some new programs coming out in the next month. I have a friend that went from Medicare and a supplement policy to the Advantage one and saves a bundle and it includes dental and eyeglasses and some other stuff. Lots of over the counter stuff paid for too.... Not for someone taking a bunch of medicines and in poorer health. Until, and if, I have this shoulder replaced, I am not switching. If your health declines, it will be impossible to be able to afford to go back to a regular medicare and supplement plan.
One plan I got quoted... medicare advantage would have up to 3900 max out of pocket... costs were really low and some co-pays... I have had 1 ankle and both knees replaced... to the tune of say 25,000 for each joint...... with all the hospital and dr and all the fees..... Then there is PT afterwards and that is invaluable to learn to use the joint and the muscles and ligs and tendons properly and not do it wrong in the beginning....
My medicare that they take out of the SS check is about 150 /mo? and the supplement just went up to $150 a month... so 3600 a year.+/-...... I pay a one time $350 "deductible" at the beginning of the year.... and EVERYTHING else I have done, including stay in a rehab facility, and PT for a year on the knees... was TOTALLY paid for. No co-pays, nothing except for the "drug plan" that I have... and that is right about $120 a year since I take no medicine regularly....
So it depends on your health.... if you know anyone in the health ins field... talk to them. Once I do the shoulder, I am going to seriously look into switching... but there are things it does not cover well, and the older we get, it could be a trade off for what they don't pay. PLUS.... some drs will not take the advantage plans.... poor rates for dr payments.. Have been told by a couple of places in the past that they do NOT take medicare advantage plans....

 

[rocfarm]

Always buy the best insurance for my wife's vehicle I can get. Always buy new vehicle for her and think about safety ratings. I'll drive a beater or walk (we live in the city).

But, 23 years ago now someone tried to get me to overpay for some life insurance. I sat down and worked out what I'd have if we just saved that amount each year. Decided to risk it. Still have all that we saved and more. But don't view it as spendable, just as a reserve fund for disasters.

Other than liability, none of my other stuff is insured. I'll take the risk—feel like that's a good one to take.

Also feel like not having comprehensive insurance helps with the safety aspect of what one is doing. I often think about how much breaking something is going to cost me before starting a project. Makes me focus a bit more when I'm driving or working, so not a bad thing.

I will say this in praise of Texas's government—they really try to protect the agricultural folks. From my understanding, if you post the right signs and do your best to keep your fences up, it's darn near impossible for your farm/ranch to have a successful claim made against it. Really appreciate that—seems like those laws keep farm liability insurance rather low.

 

[chevytaHOE5674]

Other than liability, none of my other stuff is insured. I'll take the risk—feel like that's a good one to take.

When I had inexpensive equipment I never had insurance. They I upgraded and decided that if/when one piece burned up it would be a large burden/impossible to replace. So I started insuring equipment. Had a 150k piece of equipment burn to the ground, insurance company paid for a rental, so I was back to work 48 hours later and paid for a replacment machine as soon as one was located.

None of that would have been possible in that time table without good insurance.

If you run tractors, skid steers, balers, etc its not IF its WHEN one burns to the ground. Ha

 

[rocfarm]

When I had inexpensive equipment I never had insurance. They I upgraded and decided that if/when one piece burned up it would be a large burden/impossible to replace. So I started insuring equipment. Had a 150k piece of equipment burn to the ground, insurance company paid for a rental, so I was back to work 48 hours later and paid for a replacment machine as soon as one was located.

None of that would have been possible in that time table without good insurance.

If you run tractors, skid steers, balers, etc its not IF its WHEN one burns to the ground. Ha

Not my world. Just have a small place and less than 50k in equipment. Got my tractor off of Craigslist. Try not to run it, but did put 50 hours on it this past July.

Cabin/house on my place is comfortable enough to stay in, but pretty rustic. Insurance agent wanted me to insure it when I bought farm liability. I told him I'd be out 50 bucks if it burned down, so no need. They sure do insist I pay residential taxes on that thing at the county tax office, though. Got it valued for way more than it's worth, too.

Houses of course need insurance, but I feel like liability is enough for my land and ugly cabin.

That feeder flash guy is always trying to get people to buy LRPs and such. But I figure I'll just keep taking risks. Not sure I'm ok with how much government has gotten involved with our housing, ag., university, etc. costs. Doesn't seem to be working out. Actually seems to be one of the reasons prices are inflating so much, especially for college tuition and housing.

It might be better/cheaper for people to have a little more skin in all these games and the government to have a little less.

 

[Mountaintown Creek Ranch]

My wife and I were just talking about this last week. Over the last 30 years we're not even sure how much we paid in insurance premiums between the ranch and the house and all the equipment and vehicles and livestock.
That being said we have been unfortunate a few times and had to make insurance claims.
I agree it's getting very difficult to make a claim anymore. I truly believe that the first move on an insurance company's part is to deny, deny, deny.
Or house is in thick woods and we could not afford to rebuild without insurance if it burnt down.
We don't owe anything on our properties but for right now we have to stay insured in my opinion.

 

[TCRanch]

Our insurance is ridiculously expensive, but I feel it's a necessity. And deductible as a necessary expense on our taxes. The only thing we have dropped is the rider for my jewelry, primarily because we switched insurance companies and it would have to be written by a 3rd party (plus, I'd have to get all new appraisals). You don't need it until you do.

 

[farmerjan]

Just looking at insurance also since both house and vehicles are up for renewal. Have to have house insured due to mtg even though it is less than half the value of the appraisal of the house, and the land actually is worth about what the mortgage balance is left. But no way could they rebuild the value of this 100 yr old house for what it is appraised for... and insurance penalizes for "age of structure"....

I am locked into a rate schedule on my 2 vehicles for another year...that is a very good rate. I can NOT add anything to the policy but can change the coverage... since I paid off the loan on the explorer I bought from my parents estate... I do not need "full coverage" but with the deer population here and the constant road encounters, I will drop the collision but keep the comp and liability. Plus, my son had a truck stolen and comp will cover that..... Wanted to add my forester but it would hurt me, because it will "break the rate block" I have. I got a price for the 2 same vehicles and it is over 1400 when I am paying around 850 now.... so have to pretty much stay with the current situation in order to not nearly double the cost just on those 2. I think I will see if I can get a separate policy with a different company just for the forester since I want to put regular tags back on it due to the "farm use" tag change in Va. They are starting to crack down on that now, and if I am going to go the permanent VA DMV Farm Use tag, the forester will not qualify. Not worth the hassle even when I mostly use it just for feeding and things like that. Got the lenses and such all fixed on it so I can just put tags back on it. No reason to have the tags for the couple years when it was not running... New engine and transmission now and it runs good. Great car for errands and such, and I would not hesitate to take it for a long trip.

 

[rocfarm]

This is maybe weird. Dad just messaged me after I had commented in this thread. Said that the insurance is lowering the coverage of our tractor at his house—will, only cover 15000 now. Won't cover it when we take it to the farm.

They tried to go up 40% on his home insurance premium this year, after going up 25% last year. He's only ever made one claim for roof damage, so they were in the black on his policy. He switched carriers to a cheaper one.

Glad I only have old truck and a new car for the wife.

 

[Lucky]

Forgot about this as it's been several years now. We had a Polaris side x side burn on a County Road about 5 yrs ago. The kids were using it and somehow it caught fire and burned completely up. We thought it was covered on our farm policy as did our agent. We settled the claim for $21,000 and thought all was good. He called me early one morning and said I'd be getting a check that day but not to cash it. They denied our claim because the sxs wasn't at the ranch when it burned. Stung a little but we survived.

 

[Brute 23]

Forgot about this as it's been several years now. We had a Polaris side x side burn on a County Road about 5 yrs ago. The kids were using it and somehow it caught fire and burned completely up. We thought it was covered on our farm policy as did our agent. We settled the claim for $21,000 and thought all was good. He called me early one morning and said I'd be getting a check that day but not to cash it. They denied our claim because the sxs wasn't at the ranch when it burned. Stung a little but we survived.

There is a lot of money made on a false sense of coverage. Sadly, the agents don't even understand what they are selling in a lot of cases. I have caught errors multiple times on my policies.