- 1,025
To the naysayers, I say, look at the bigger picture.
ACV is inevitable.
ACV is inevitable.
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Homeowner Deductibles
- Thread starter InsuranceAgent411
- Start date
- 1,025
If one claim is going to make them homeless, maybe the house wasn't affordable for them in the first place.
I don't say that to be mean, but we Americans have a real problem with planning for disasters. We'd rather transfer our risk fully or kick the can down the road. - Unfortunately, these things have lead to massive deficits, an unsustainable housing market, a hard insurance market and a slew of other issues.
We have two options as a society, take action, or continue to kick the can down the road. You can only do the latter for so long though, eventually there will be a tipping point.
- 6,581
You don't appreciate the realities of life for a senior on Medicare with a paid for home, social security and < $80K-$100K in savings for financial resources for the rest of their life facing rising costs of medical care, medicine, food, transportation, home insurance, property insurance, taxes, costs of materials and tools -- like at home depot or the hardware store, and labor services for anything they are physically unable to do for themselves anymore.
Over, say the last 5 years, the tax assessed value of my home -- which is not on the scenic edges of the alaska intercoastal waterway, the warm california coast, in balmy FL, on the windswept coasts of Maine or in the scenic Rockies, Cascades, or Sierra Nevadas -- has increased 3-4 times the amount I have in it, based on recent sales in the area. I made an appeal and got the value reduced, for one year, to around 2x, but I won't be able to do that again.
What you are proposing would result in people having to sell their homes because they could not afford to repair them, and then being homeless because they could not afford a replacement or even to rent because even a renter friendly landlord is still faced with the same maintenance labor and material costs, insurance costs, and property taxes.
What you are proposing is tantamount to my telling you, you should sell your delorean and downsize your home as an example to get people with millions in resources to stop building homes on mudslide hillsides in CA. Not going to happen,
- 1,025
You're just proving that ACV is better for the health of the overall economy. Your assessed value and taxes increased because houses are being used as an investment tool instead of just a place to live.
You don't appreciate the realities of life for a senior on Medicare with a paid for home, social security and < $80K-$100K in savings for financial resources for the rest of their life facing rising costs of medical care, medicine, food, transportation, home insurance, property insurance, taxes, costs of materials and tools -- like at home depot or the hardware store, and labor services for anything they are physically unable to do for themselves anymore.
Over, say the last 5 years, the tax assessed value of my home -- which is not on the scenic edges of the alaska intercoastal waterway, the warm california coast, in balmy FL, on the windswept coasts of Maine or in the scenic Rockies, Cascades, or Sierra Nevadas -- has increased 3-4 times the amount I have in it, based on recent sales in the area. I made an appeal and got the value reduced, for one year, to around 2x, but I won't be able to do that again.
What you are proposing would result in people having to sell their homes because they could not afford to repair them, and then being homeless because they could not afford a replacement or even to rent because even a renter friendly landlord is still faced with the same maintenance labor and material costs, insurance costs, and property taxes.
You can choose your poison. - Be evicted from your home because you can't afford to repair it, or be evicted because you can't afford your taxes and insurance. You have to choose.
All the arguments I see against ACV are at the micro level, you have to step back and look at the bigger picture.
False equivalence. - If I can't afford a Delorean I absolutely shouldn't have one.
Also, people would stop building on mudslide hills in CA if they went bankrupt doing so, instead of being rewarded for their stupidity.
Lastly, don't hate me for speaking the truth. I'm not trying to kick you out of your house. "Sometimes people don't want to hear the truth because they don't want their illusions destroyed."
- 4,680
oh here we go with extremist views that giving consumers options will make consumers make bad decisions & end up living in a van down by the river. So, the only answer is to protect consumers from themselves not maintaining a property causing it to devalue, but make insurance companies pay to turn their older depreciating stuff into brand new shiny stuff.
- 4,680
how old was your roof? By the insurance company paying to fully pay to replace your roof, you are getting free years that you wont have to pay your normal maintenance replacement of a roof. IE: A house built in 2000 was going to need a new roof in 2020 or 2025 in most states. If you had a claim in 2023 & get a new roof that now lasts until 2045 to 2050, you completely missed a cycle of having to replace your own roof.
I have a 2012 Toyota Sequoia with 220k miles on it. If it gets totalled next week from scratching the bumper, should I get a brand new 2025 Toyota Sequoia, thus not having to pay to own a car for another decade or more? Nope, car insurance company would give me $4000 because my vehicle is past its useful life & has little to no value other than the brand new tires & the air freshener hanging on the mirror
- 4,680
no need to sell home if person hasnt been putting money in a sinking fund for known maintenance costs (yard, furnace, water heater, carpet, roof)--all the things that wear out. instead, they could take a HELOC against equity to make repairs or pay their portion of the ACV claim on items that wear out like roofs.
What does the same senior on medicare do if they have an old paid for car they dont plan on replacing for a long time, but get in an accident when they backed out of garage with the garage door down. Car is totalled & now they need a new car, but the 15 year old car is now only worth $3k (ACV). They will have to come up with money or payments to get the new car they want to buy.
ACV property doesnt affect every single item in a house like 2x4s that dont depreciate or wear out, it tends to be most used on items that wear out over an expected & known time (roof, carpet, water heater, furnace, car tires)
Allen, it wasn't my house but one of my insureds. He is 83 years old. No one 83 years old is going to get a loan and if he did how would he make the payments at his age. With inflation at the rate it is today people especially retirees are having a hard time making ends meet. Insurance companies need to either get in the insurance business or admit they can't make it and get out of the business.
- 4,680
Agree with all you say..... but is it the insurance company & the other customers responsibility to pay for the portions of home & auto maintenance or depreciation. Why not force the contractors to charge less to the elderly for the portions that are improving the property value & position. Why not the local government? Why not just levy taxes on the 1% to cover it? Just wondering why it falls solely on carrier to do this?
Last I saw, something like 40% of people over age 80 still had a mortgage that is shocking.
Inflation is astronomical everywhere.
Without ACV for roofs as an option, carriers will non renew all those elderly peoples houses with older roofs & that will mean no coverage for any type of loss until they put new roof on. Better to partly participate in ACV roof claim than no coverage. If ACV wasn't how total loss auto claims are settled, carriers would cancel all cars off policies once they get to 7 to 10 years or X miles
- 1,499
In UT I bought my first home with an old roof. I REPLACED IT by getting up on it and doing the work because there is no hail in UT or high wind.
When I moved to CO, I bought a house with an old roof and waited. two years later a hailstorm came through and the insurance company magically replaced it and some windows! And Painted my house and fence and deck. I probably paid $1,200 in Prem and the Insurance company paid 40,000. BTW, two more hail storms came in the 5 years that followed. So I paid $3,600 for three claims and the insurance company paid $120,000 for three claims. The Math does not math.
The moral of the story. If carriers move to more risk sharing- they will..(This can happen in many ways, not just ACV) then the American homeowner has to reconsider the cost of home ownership.
When I moved to CO, I bought a house with an old roof and waited. two years later a hailstorm came through and the insurance company magically replaced it and some windows! And Painted my house and fence and deck. I probably paid $1,200 in Prem and the Insurance company paid 40,000. BTW, two more hail storms came in the 5 years that followed. So I paid $3,600 for three claims and the insurance company paid $120,000 for three claims. The Math does not math.
The moral of the story. If carriers move to more risk sharing- they will..(This can happen in many ways, not just ACV) then the American homeowner has to reconsider the cost of home ownership.
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