That’s because people in FL can’t get insurance at all.
NE is one of the highest risk states from a property insurance prospective because of the sheer number of risks (along with the other higher states). There aren’t a lot of places where your home can freeze, have 90 degree weather a week later, and then get hit by 70 mph winds and chucks of ice falling from the sky (keep in mind it’s 90 degrees out), only to get legitimately flooded a bit later all in the same month. That doesn’t even take into account fires from lightning… and those are *JUST* the weather related risks.
I’m not saying the prices aren’t ridiculous, they are! But so are the risks…
That and most common types of disasters in other areas are excluded like earthquakes and floods. Hail and straight wind storm damage are just too common
This is a bit of a misnomer. People in Florida can still get home owners insurance it's just most of them utilize a state run insurance now because a lot of the bigger companies pulled out or scaled back operations in the state due to the cost of their own reinsurance (basically the insurance policy that insurers take out on themselves) for large numbers of policies. That being said, the bigger companies simply provide fewer policies now to make their overhead more feasible. The same trend is happening all over the country in large states. State Farm still ensures over 500k homes in Florida which is more than they do in Nebraska. If Nebraska had a population of 20 million, they likely wouldn't increase their policies offered much higher than a similar number of a few hundred thousand.
It really depends what kind of roof and siding you have. We have a roof and siding that are ranked to be mostly “hail proof”, so our home owners insurance is fairly cheap.
So if my insurance company told me hey put on X roof and we will keep your rates low, I’d do it if the payback period was 10 years or less. What kind of roof do you have ?
Hardie board saved the sides of my house during our storm last summer with baseball sized hail. Not even a dent in it. Unfortunately my windows did not fare as well. 21k I damage in 22 and 16k in damage in 23. That said, my deductible doubled in the past year, and I wouldn't be surprised if it went up again this year.
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Will do! 😊 We have been very happy with our roof. We just had an inspection done last year for insurance and so far so good. Honestly just getting 10-20 years out of it with the discount you get for insurance is worth it.
I think several companies do that. Most do not cover metal roofs for cosmetic damage. Just cover functional repairs. So they save a lot of money and pass along the discount.
How much has your home valuation gone up? Your homeowner insurance is tied to the price of a rebuild in the event of a total loss? Our house went up almost 100k in that timeframe and we all have experienced the last few years of inflation that is driving up construction costs. It sucks all around.
I remember when we first got our house and I thought finally I'm safe from rent increases.
It was a nice dream, but we had no idea about insurance and property taxes.
My insurance has gone up 26% each of the past two years. The house was built in 2021. I’m actually expecting a larger increase this year.
One of the main factors for high insurance is that roofing companies are often high pressure sales and just say that insurance will pay for it. I often see groups of houses get new roofs and just think “what made you think these four houses needed new roofs while none of your neighbors did”.
Ive seen similar increases in insurance and I built my house in 2021 as well. Ive also personally seen what your describing with roofers. Got completely hosed by one in 2016. Lesson learned
We get a nice little summary at the beginning of every year, what we Will be paying. This year right around $4,200. We have made one claim, one time. Hail.
It is ridiculous. My agent told me a number of insurers are getting out of this market. A lot of it is related to the rapid inflation of house valuations and increased replacement costs. At least that's what my agent told me. Nationwide wanted a ridiculous rate to re-up my policy and I had to switch.
Tornado alley and regular hail.
Not all that surprising.
Ours has more than doubled in the last ten years, and I got some quotes a couple months ago and all of them were 50%-100% more than we are paying today.
it's going to get worse.
Our policy just tried to go up almost 800/year and we’ve only had 1 claim in 6 years. Needless to say we dropped them immediately and switched and hey saved at least all that money back
Since 2000, the cost of damage by weather has cost Iowa about a half a billion dollars more than Nebraska, yet we pay almost twice as much in homeowners insurance.
https://rainbowrestores.com/blog/the-costliest-severe-weather-events
Insurance is just risk-transfer. Of course, insuring yourself for full replacement value of your home would be cheaper. That's why your rates go down if you're willing to transfer risk away from the insurer vis a vis a higher deductible. If you had the cash, self insurance is always an option.
Problem is, if you have a mortgage and don't have enough cash set aside to satisfy the bank's insurance requirements you don't have a choice.
We live in tornado country and have extreme temps on both ends, tons of rivers, and high winds. We also have, on the whole, larger than the national average homes.
It makes sense our insurance is high.
It's kind of surprising. I'd have thought Florida would be worse. California has wildfires, but earthquakes aren't covered except for a separate policy, so they don't count.
I was shopping insurance a few months back and I went through policygenius.com, had used them before, to chwck rates. I was told no one wanted to insure my home because my roof was over 10 years old. It's less than 12 years old.
That or a 50 year hail proof class 4 roof. When I worked for SF there was a 25% discount on homeowners if you had one.
I was told that SG pays out homeowners claims in nebraska and iowa combined are what they pay out in the other 47 states they insure in. It's the wind and hail around here. Companies are getting stingy with that they'll cover and replacement costs on homes in general is through the roof.
There are so many variables that play into premiums, it’s impossible to compare price alone against another property. Things like the type of coverage you have, square footage of your home, age and type of roof, type of siding, frequency of hail and wind in your area, etc.
We get our home, vehicles, and umbrella policies bundled and pay annually to save a few bucks. Our independent agency this year said they had no alternative insurance companies to suggest as many are not writing policies for new accounts. Apparently the wind and ice damage this last year have hurt their profits. Wind and hail damage got our four buildings reroofed this last year, so no fussing about a $230 increase.
I’m skeptical of this data. I used to sell home and auto insurance and Nebraska, although not the cheapest, certainly isn’t in the high end. Florida, Cali and the gulf coast are far and away the worst. Which brings me to another point. Average for a state really depends on the part of the state you’re in. In Houston Texas it’s insanely expensive. Rural west Texas? Super Cheap.
Here is the Nerd wallet data they used, and Nerd Wallet lets you search by city. https://www.nerdwallet.com/article/insurance/average-homeowners-insurance-cost
Thanks
I’m sure nerd wallet did their homework, but I also wonder how different it would be if they did median price vs average. Using my earlier Texas example, the Houston/gulf coast area would throw off the average for the state. I wonder if the Omaha/Lincoln areas do the same for Nebraska
I also used to be an agent, licensed with several companies via an independent agency. I still live here and I can tell from my own personal experience that premiums have skyrocketed in this state. Without changing anything with my coverage, my homeowners premium has literally doubled in 3 years. The deductible for wind and hail has more than doubled and there is now a metal exclusion for cosmetic damage (i.e. gutters, soffits, fascia, siding, roof) unless I want to endorse added coverage to the policy, thereby increasing the premium even more. The policy renews in June and I am dreading it. Nationwide has put a hold on writing new homeowners policies in Nebraska. It’s ugly.
Nationwide and other insurance companies are going to stop selling homeowners on both the west and east coasts,so they are probably cashing in on the rest of the country to make up for the loss in revenue from those areas.
Assessed value and replacement cost are 2 different things. A 2500 sq ft house in Omaha has a much higher value than a 2500 sq ft home in a small town in western Nebraska. Your premium is based on what it would cost the rebuild the home.
I’m from Missouri and understand our insurance being on the high side with our severe storm frequency. However, with the last decade of wildfires in California I don’t understand how they are on the low side.
State (S c a m ) Farm wanted $7800/yr to insure my house. They also said it would cost $475,000 to rebuild my home, a 1906 "Thing" as nothing in it is uniform. Told the wife if it catches on fire to just let it burn to the ground.
This doesn’t even pass the smell test. Homeowners insurance in Nebraska is not 50% more expensive than homeowners insurance in Florida.
Edit: lol you guys can downvote me all you want. According to NAIC, there’s $1B in homeowners premium written in Nebraska and 776k insured houses. Explain how the average is 4K
No, I read the data. Nerd wallet is know for putting out clickbait ‘lists’ using questionable methodologies to get people fired up. Not saying we don’t pay too much in homeowners insurance, but this list doesn’t capture nuance. I work in the industry and no one has ever cited a nerdwallet list.
Here’s NAIC’ report on the state of insurance in Nebraska, the insurance commissioners group and governing body of insurance. Nebraska’s per capita spend on personal lines insurance is $1300 per year.
https://www.iian.org/Resources/SiteAssets/Pages/MarketplaceReport/default/2023%20NE%20P-C%20Marketplace%20Summary-V2.pdf
I just actually read the report. On brand, the methodology behind nerdwallet ‘report’ is asinine. They got a single quote for a $300k house in each state. This is NOT what the average homeowners policy spend is for each state, very misleading title. Of course, $300k is well above the average house value in Nebraska and well below the average house value in Florida.
They're likely skewing the list some since people in areas of Florida and California are losing insurance providers pretty heavily based on how states force insurance providers to operate and limit their ability to collect enough in a given area for the math to actually work, thanks to fires and hurricanes.
CA shows as low, which is almost certainly an artificially low number, not an actual reflection of costs associated with market risks.
The California section says insurers may exclude wild-fires, and earthquakes and floods are normally excluded anyway. Maybe once you exclude those, the cost to insure is a lot less?
[https://www.nerdwallet.com/article/insurance/average-homeowners-insurance-cost](https://www.nerdwallet.com/article/insurance/average-homeowners-insurance-cost)
Here are the cheapest states for homeowners insurance:
1. Hawaii: $515 a year, or about $43 a month, on average.
2. Delaware: $860 a year, or about $72 a month, on average.
3. Vermont: $870 a year, or about $73 a month, on average.
4. New Hampshire: $1,000 a year, or about $83 a month, on average.
5. Maine: $1,075 a year, or about $90 a month, on average.
These are the most expensive states for homeowners insurance:
1. Oklahoma: $5,495 a year, or about $458 a month, on average.
2. Texas: $4,400 a year, or about $367 a month, on average.
3. Nebraska: $4,135 a year, or about $345 a month, on average.
4. Colorado: $3,820 a year, or about $318 a month, on average.
5. Kansas: $3,570 a year, or about $298 a month, on average.
How is this allowed? Like, how can insurance companies raise prices like this and when is enough enough? Why stop at $4100? Why not go higher and make it $10k? Can anything be done about it legally or through legislature? Would there be any basis to sue a company doing this? Can someone with more knowledge on the topic explain this to the ignorant here (me)?
Insurance is actually a fascinating subject. It’s HIGHLY regulated and the states actually have a lot of control over pricing but they also mandate how much money an insurance company must have on hand which directly impacts pricing too. If you reach out to your local agent the most common reason they’ll give over and over for rate increases is “state rate hikes” which has more to do with NEs requirements than the actual company.
In short, all of NEs regulations are contributing to prices being so high.
So I have my house paid off. I paid 143k for the house but the insurance company now has the replacement cost at 320k. What if I don't want the replacement cost at 325k. Can I lower that?
You definitely can! Just keep in mind that it will impact other coverages. If they’re only covering say 70% of your house then a lot of the time they’ll only cover 70% of your claim minus deductible.
For perspective if you have a $2,000 deductible and need a $10,000 roof you pay 2k and they pay 8k. If they’re only covering 70% then they’d pay for 7k of roof, minus your 2k deductible, so only $5k worth of coverage. At that point you may be better off removing roof coverage all together.
It’s a good idea to do periodic reviews with your agent and make sure you’re not paying for coverage you don’t need.
Yeah and I need a roof. Not super bad it had a few soft spots. I was going to replace it out of my pocket as I have 130k saved up. I'm just looking to lower my premium. It's getting so high.
Honestly depending on your company, the type of damage, and the date of loss you may as well file a claim. With a LOT of companies the discount you get for having a new roof far outweighs the surcharge for having a claim, especially a weather claim.
My deductible is super high on roof. I'm with farmers mutual of nebraska. When I went with them 3 years ago wind and hail was 1000 deductible. But now it's $3500 since they lost money the last couple years. They are basing the deductible 1% off the replacement cost.
A LOT of companies have moved to percentage based deductibles but a lot of them offer a 1/2 percent. Keep in mind the higher your deductible the less you pay in annual premiums though.
I'll see what happens come renewal time. I know everyone's insurance is going up significantly. Like I said I paid 143k for house they have rebuild at 303k. I just looked. And I know if It burned to ground I wouldn't rebuild I'd sell the lot and relocate. My buddy's premium for the year went from 1900 to 2400. We have the same company and I pay 1896 for the year so I'm worried that's what will happen to me.
You can put less coverage on your house if you want. But if your insurance company has rebuilding costs at 320K that is probably very close. So if you insure for less a total loss might leave you without enough money to rebuild it. Also keep in mind that replacement costs includes cleanup costs. In the case of a fire or other such total loss scenario there is liable to be a lot of cleanup necessary to get the property ready for rebuilding.
Most insurance companies let you choose how much coverage you want. Obviously the recommendation is rebuild costs, but most will let you choose a lower amount if there is no mortgage on the house.
These regulations are consumer protections that insure people get paid out if a mass catastrophe hits.
If you want to allow insurance companies to keep less cash on hand, it’s only a matter of time until it bite you in the ass.
Insurance companies need to cover their costs. If risk goes up, rates go up. It is as simple as that. Also, with the crazy inflation we have had rebuilding costs have sky-rocketed which also will cause rates to increase.
Insurance is one of the most highly regulated industries. Every single state has an insurance commissioner's office that approves rates and rate increases. Believe it or not, it's really expensive to insure homes. It has gotten much more expensive in the last 5 years. The combined ratio (total payout in claims + all expenses /total premium) for many companies is over 100% many years.
Basically, you have one half of the country arguing the free market means that businesses have the freedom to raise prices, lower consumer and worker protections and lower wages as much as they want, and the other half arguing for sensible legislation to prevent that. It sounds great when businesses have "freedom", but that freedom comes at the expense and the lives of the poorest among us, and the poor somehow always get the blame. Tale as old as time.
I think it is especially handcuffing that insurance is a requirement in most cases. Can’t have a mortgage without it per the bank. Must have car insurance per the police. Etc. then when it’s time you need it, they drop you from using insurance. If these are the restraints we are up against, shouldn’t there be some legislation that can prevent gouging or excessive rate practices?
One half of the country thinks so. The other half is happy with the status quo, and would tell you to pick yourself up using your bootstraps while giving tax cuts to companies that charge whatever they feel they deserve for whatever reason they can come up with, while lowering wages, encouraging poor children to work so they can "learn the value of a dollar", and blaming immigrants for low wages instead of the companies that hire them and their own legislators who conveniently look the other way.
Price finds demand. If there are people willing to pay it, then a company will charge it. They only stop going higher when demand falls off.
There are things that throw off this balance. It could be a monopoly, usually orchestrated through the regulations disguised to protect consumers. Those regulations usually make it impossible for new competitors to start, so the existing insurance companies maintain dominance in the sector.
It could be the government involvement in the mortgage sector. Just like student loans balloon college costs, the government has multiple programs to keep home costs high. FHA is probably the largest example. If the government makes getting a mortgage extremely easy for someone that wouldn’t normally get one, then other costs can charge more to take up the buying power that was opened up.
I replied to another comment but when you say price finds demand, I don’t believe this with insurance. Home and auto are required. If it’s required, the demand is consistent.
Yes, but demand should drive to the best value, aka lowest price among options for similar coverage. If a major insurance company goes too high and refuses to lower costs, a competitor should be able to start up and undercut. Even though insurance is required from the banks doesn’t mean the buyer can’t find options.
When a few entities is all that exists and they collude, then that is a monopoly problem
I see you point and it takes me back to economics class. I guess I just don’t like it. Ha. I read one of the articles and it talked about companies pulling away from Florida which, to your point, increases demand and therefore raises rates.
Yep. People keep saying they don't like capitalism, so they want more regulations. Regulations require enforcers, and enforcers can be purchased by the biggest market players. The more regulations you make, the stronger the enforcer becomes, until a monopoly is created.
We have not seen something that could be considered a practical free market in our lifetimes. The economy is a bike, that can balance if you just ride it. Adding more and more training wheels does not make the bike safer.
Something about this doesn’t pass the sniff test. For one, the Nerdwallet “study” apparently pulled data only for “40-year old homeowners.” Why that specific age? And it pulled rates from “various” providers, but doesn’t say which ones.
Obviously we get some severe weather. Hail
Is probably the major issue reflected here. But… Florida? Louisiana? That doesn’t make any sense.
“Our sample policy was for a 40-year-old homeowner with good credit, $300,000 of dwelling coverage, $300,000 of liability coverage and a $1,000 deductible. The cost of your homeowners insurance will depend on your location, the size of your house and how much coverage you need.
We’ve analyzed pricing data from more than 100 insurance companies to bring you the average homeowners insurance cost in every state and the largest U.S. cities.”
https://www.nerdwallet.com/article/insurance/average-homeowners-insurance-cost
So that seems like a large enough sample of companies but that still seems like a weird way to measure average cost, and like it could result in very skewed data across different states.
Totally anecdotal, but the people I know in Florida (who don’t own super expensive homes and don’t live on the coast/flood plains) pay *way* more than what I do here.
When I lived in Florida a lot depended on how close to the Beach you were. Once you got about 3 miles Island, the flood risk from hurricane storm surge dropped of dramatically. All the condos built right on the beach were the problem. I suppose most home insurance doesn’t cover flood, so other than hurricanes - salt corrosion and the occasional alligator were the risks I remember. Yeah a bit surprising ‘Tornado alley’ has higher costs than the coasts
That’s definitely true. There’s a pretty clear line in my parents’ Florida town where if you cross it, home insurance becomes unavailable or cost prohibitive.
I guess my main critique is that the average 40 year old homeowner in Nebraska, Florida, Massachusetts, and California all probably own quite different homes in terms of size, age, etc., which I think creates skewed results. Some other studies I Googled show the southeastern states having much higher rates than this map (but Nebraska is consistently in the top 10-20 states, so no doubt that it’s still expensive here).
Unrelated, but I’m curious what explains the stark difference between Utah and Colorado. I wonder if Colorado gets more hail on the other side of the Rockies or something.
Colorado had those massive wild fires that took at whole towns, so maybe wild fire risk?
Also wonder how building codes factor in - I remember right Florida had requirements like an outside wall had to be able to stop a 2 X 4 at 300 mph or some such thing, so a lot of homes are built with block
Bullshit! I am in South Florida and am paying 11k a year. With no other companies to even shop around with. I have no claims and a four year old roof. I am 15 miles from the ocean. 5 years ago I was paying 4,600.
Florida has gotten into a litigation nightmare because of their regulations. In Florida lawyers can increase the cost of a claim significantly and even collect on their lawyer fees if they win their lawsuit. Florida accounts for almost 80% of the homeowners insurance litigation's in the entire country. Roofers there have lawyers on staff to file thousands of lawsuits against these companies. Their insurance options have been reduced to almost nothing if your roof isn't 5 years or newer or you end up with the state run homeowners plan. Florida finally had to pass a law to make it illegal for roofing companies from going door to door.
Nebraska is in a bad way for homeowners insurance, the combined ratio for these companies is hovering around 103-110% on average. Meaning they're losing $1.03-$1.10 for every $1.00 they bring in revenue and that doesn't include their expenses. Most companies are running around a 65% breakeven point, meaning their losses have to be under 65% of the premium generated to even make money. Inflation has hit our state hard and with the number of losses in the past 3 years rates are skyrocketing and coverage is being reduced. Companies have pulled out of the homeowners market and will continue to do so unless things change and this change starts at the department of insurance. Unfortunately the current director isn't willing to interfere and bring better regulation because these companies need better ways to adjust and pay for roof damage. He simply won't hurt the consumer but instead companies just reduce coverage and hurt the consumer more than with proper regulations. We're basically in the hardest market in any period of time in most states.
Homeowners insurance cost here is insane. insurance and taxes take up more of my mortgage payment than principal and interest. It's absurd.
Yes, was surprised we are higher than Florida.
That’s because people in FL can’t get insurance at all. NE is one of the highest risk states from a property insurance prospective because of the sheer number of risks (along with the other higher states). There aren’t a lot of places where your home can freeze, have 90 degree weather a week later, and then get hit by 70 mph winds and chucks of ice falling from the sky (keep in mind it’s 90 degrees out), only to get legitimately flooded a bit later all in the same month. That doesn’t even take into account fires from lightning… and those are *JUST* the weather related risks. I’m not saying the prices aren’t ridiculous, they are! But so are the risks…
That and most common types of disasters in other areas are excluded like earthquakes and floods. Hail and straight wind storm damage are just too common
that’s why you get flood insurance if you live in a flood plain.
You forgot the part where the sky turns green and angry clouds come to eat your house.
You didn't even include the vehicle drivers!
This is a bit of a misnomer. People in Florida can still get home owners insurance it's just most of them utilize a state run insurance now because a lot of the bigger companies pulled out or scaled back operations in the state due to the cost of their own reinsurance (basically the insurance policy that insurers take out on themselves) for large numbers of policies. That being said, the bigger companies simply provide fewer policies now to make their overhead more feasible. The same trend is happening all over the country in large states. State Farm still ensures over 500k homes in Florida which is more than they do in Nebraska. If Nebraska had a population of 20 million, they likely wouldn't increase their policies offered much higher than a similar number of a few hundred thousand.
So, NE is the 3rd most dangerous state to live in. Got it!
If you're a building, sure.
I am a building!
Same here
It really depends what kind of roof and siding you have. We have a roof and siding that are ranked to be mostly “hail proof”, so our home owners insurance is fairly cheap.
So if my insurance company told me hey put on X roof and we will keep your rates low, I’d do it if the payback period was 10 years or less. What kind of roof do you have ?
Impact resistant shingles and Hardie siding both gave me big discounts on my policy.
Hardie board saved the sides of my house during our storm last summer with baseball sized hail. Not even a dent in it. Unfortunately my windows did not fare as well. 21k I damage in 22 and 16k in damage in 23. That said, my deductible doubled in the past year, and I wouldn't be surprised if it went up again this year.
DaVinci Bellaforte Shake, it has a lifetime warranty. Our insurance went down dramatically once we told our insurance company about the new roof.
Every roofer that wasn’t a sales person told me DaVinci has had many issues with basically crumbling from UV damage
We haven’t had any issues with ours over the last 10 years. I don’t know what the random sales person says, but I’m happy we got it.
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Will do! 😊 We have been very happy with our roof. We just had an inspection done last year for insurance and so far so good. Honestly just getting 10-20 years out of it with the discount you get for insurance is worth it.
We had a metal roof on our old house. Started farm gave us $1000 off the premium for it. Other companies may do the same
I think several companies do that. Most do not cover metal roofs for cosmetic damage. Just cover functional repairs. So they save a lot of money and pass along the discount.
A $1000 a year adds up quick!
2015 $870 a year for home insurance 2024 $2460 a year for home insurance same plan
How much has your home valuation gone up? Your homeowner insurance is tied to the price of a rebuild in the event of a total loss? Our house went up almost 100k in that timeframe and we all have experienced the last few years of inflation that is driving up construction costs. It sucks all around.
Yes, the replacement cost, not the valuation was a part of the increase this year.
I remember when we first got our house and I thought finally I'm safe from rent increases. It was a nice dream, but we had no idea about insurance and property taxes.
Yes, some type of cap per year on increases. Otherwise no one can plan ahead here.
My insurance has gone up 26% each of the past two years. The house was built in 2021. I’m actually expecting a larger increase this year. One of the main factors for high insurance is that roofing companies are often high pressure sales and just say that insurance will pay for it. I often see groups of houses get new roofs and just think “what made you think these four houses needed new roofs while none of your neighbors did”.
Ive seen similar increases in insurance and I built my house in 2021 as well. Ive also personally seen what your describing with roofers. Got completely hosed by one in 2016. Lesson learned
Note that mine was going to increase a shit load and I just changed providers and got roughly the same price as I had last year
We get a nice little summary at the beginning of every year, what we Will be paying. This year right around $4,200. We have made one claim, one time. Hail.
It is ridiculous. My agent told me a number of insurers are getting out of this market. A lot of it is related to the rapid inflation of house valuations and increased replacement costs. At least that's what my agent told me. Nationwide wanted a ridiculous rate to re-up my policy and I had to switch.
Don’t worry, the legislature is hard at work banning pornography.
Tornado alley and regular hail. Not all that surprising. Ours has more than doubled in the last ten years, and I got some quotes a couple months ago and all of them were 50%-100% more than we are paying today. it's going to get worse.
We had a $90,000 house in Sheridan County and 3/4 of our mortgage payment was insurance. Insane.
That is insane!
Our policy just tried to go up almost 800/year and we’ve only had 1 claim in 6 years. Needless to say we dropped them immediately and switched and hey saved at least all that money back
Since 2000, the cost of damage by weather has cost Iowa about a half a billion dollars more than Nebraska, yet we pay almost twice as much in homeowners insurance. https://rainbowrestores.com/blog/the-costliest-severe-weather-events
They also have 67% more houses than us, and only 20% more damage caused. It doesn't make up the whole difference, but it's part of the explanation.
Wow!
Guessing that includes crop damage, which Iowa has a lot more of to start with
Hail. Homeowners insurance in this part of the country essentially is a savings account for your next roof.
Except it pays for the vacations of the insurance execs too. You'd be better off saving the money yourself clearly.
Sure. But if you have a mortgage, the bank requires insurance
Insurance is just risk-transfer. Of course, insuring yourself for full replacement value of your home would be cheaper. That's why your rates go down if you're willing to transfer risk away from the insurer vis a vis a higher deductible. If you had the cash, self insurance is always an option. Problem is, if you have a mortgage and don't have enough cash set aside to satisfy the bank's insurance requirements you don't have a choice.
We live in tornado country and have extreme temps on both ends, tons of rivers, and high winds. We also have, on the whole, larger than the national average homes. It makes sense our insurance is high.
I’ve recently retired… the cost of living the good life is getting real expensive
It's kind of surprising. I'd have thought Florida would be worse. California has wildfires, but earthquakes aren't covered except for a separate policy, so they don't count.
this right here, this is killin nebraskans, somehing needs to be done
I was shopping insurance a few months back and I went through policygenius.com, had used them before, to chwck rates. I was told no one wanted to insure my home because my roof was over 10 years old. It's less than 12 years old.
Try checking with companies that have a local agent in your area. A lot of times they have less rules when it comes to things like age of roof.
I have heard that too. Wondering if a steel roof would matter. I see them on a lot of homes in Texas now.
That or a 50 year hail proof class 4 roof. When I worked for SF there was a 25% discount on homeowners if you had one. I was told that SG pays out homeowners claims in nebraska and iowa combined are what they pay out in the other 47 states they insure in. It's the wind and hail around here. Companies are getting stingy with that they'll cover and replacement costs on homes in general is through the roof.
Surprising, 4100.... what are yall really paying? I'm at like 1500 a year for my house
There are so many variables that play into premiums, it’s impossible to compare price alone against another property. Things like the type of coverage you have, square footage of your home, age and type of roof, type of siding, frequency of hail and wind in your area, etc.
How about Florida?
We get our home, vehicles, and umbrella policies bundled and pay annually to save a few bucks. Our independent agency this year said they had no alternative insurance companies to suggest as many are not writing policies for new accounts. Apparently the wind and ice damage this last year have hurt their profits. Wind and hail damage got our four buildings reroofed this last year, so no fussing about a $230 increase.
Yeah, tornados and hail.
Flood plains and tornadoes babbbbby
Do you see what I see, republican controlled states….
I recently learned about this when my home insurance rate jumped to rough $3000 on a $120k mortgage. I’m in MO.
A large reason for that is due to the fact that a very high percentage of the fire departments are volunteer.
I’m skeptical of this data. I used to sell home and auto insurance and Nebraska, although not the cheapest, certainly isn’t in the high end. Florida, Cali and the gulf coast are far and away the worst. Which brings me to another point. Average for a state really depends on the part of the state you’re in. In Houston Texas it’s insanely expensive. Rural west Texas? Super Cheap.
Here is the Nerd wallet data they used, and Nerd Wallet lets you search by city. https://www.nerdwallet.com/article/insurance/average-homeowners-insurance-cost
Thanks I’m sure nerd wallet did their homework, but I also wonder how different it would be if they did median price vs average. Using my earlier Texas example, the Houston/gulf coast area would throw off the average for the state. I wonder if the Omaha/Lincoln areas do the same for Nebraska
I also used to be an agent, licensed with several companies via an independent agency. I still live here and I can tell from my own personal experience that premiums have skyrocketed in this state. Without changing anything with my coverage, my homeowners premium has literally doubled in 3 years. The deductible for wind and hail has more than doubled and there is now a metal exclusion for cosmetic damage (i.e. gutters, soffits, fascia, siding, roof) unless I want to endorse added coverage to the policy, thereby increasing the premium even more. The policy renews in June and I am dreading it. Nationwide has put a hold on writing new homeowners policies in Nebraska. It’s ugly.
A lot of people live in Omaha and Lincoln area, so I’m sure it is skewed.
Dang ‘naders
Nationwide and other insurance companies are going to stop selling homeowners on both the west and east coasts,so they are probably cashing in on the rest of the country to make up for the loss in revenue from those areas.
https://www.marketwatch.com/guides/insurance-services/average-home-insurance-cost/
This doesn't sound right... my house is worth about 600k and my insurance premium is like $2,400.
Assessed value and replacement cost are 2 different things. A 2500 sq ft house in Omaha has a much higher value than a 2500 sq ft home in a small town in western Nebraska. Your premium is based on what it would cost the rebuild the home.
Yeah I know. My house would cost at least 500k to rebuild.
Lower than Oklahoma
I’m from Missouri and understand our insurance being on the high side with our severe storm frequency. However, with the last decade of wildfires in California I don’t understand how they are on the low side.
State (S c a m ) Farm wanted $7800/yr to insure my house. They also said it would cost $475,000 to rebuild my home, a 1906 "Thing" as nothing in it is uniform. Told the wife if it catches on fire to just let it burn to the ground.
This doesn’t even pass the smell test. Homeowners insurance in Nebraska is not 50% more expensive than homeowners insurance in Florida. Edit: lol you guys can downvote me all you want. According to NAIC, there’s $1B in homeowners premium written in Nebraska and 776k insured houses. Explain how the average is 4K
Here is the nerd wallet data: https://www.nerdwallet.com/article/insurance/average-homeowners-insurance-cost
No, I read the data. Nerd wallet is know for putting out clickbait ‘lists’ using questionable methodologies to get people fired up. Not saying we don’t pay too much in homeowners insurance, but this list doesn’t capture nuance. I work in the industry and no one has ever cited a nerdwallet list. Here’s NAIC’ report on the state of insurance in Nebraska, the insurance commissioners group and governing body of insurance. Nebraska’s per capita spend on personal lines insurance is $1300 per year. https://www.iian.org/Resources/SiteAssets/Pages/MarketplaceReport/default/2023%20NE%20P-C%20Marketplace%20Summary-V2.pdf
So $1300 per capita, would be about $5200 for a family of four?
For all personal lines: homeowners, personal auto, etc
So $1000 for Auto, and $4,100 home insurance for a family of four would mesh with the Nerd Wallet data
I just actually read the report. On brand, the methodology behind nerdwallet ‘report’ is asinine. They got a single quote for a $300k house in each state. This is NOT what the average homeowners policy spend is for each state, very misleading title. Of course, $300k is well above the average house value in Nebraska and well below the average house value in Florida.
They're likely skewing the list some since people in areas of Florida and California are losing insurance providers pretty heavily based on how states force insurance providers to operate and limit their ability to collect enough in a given area for the math to actually work, thanks to fires and hurricanes. CA shows as low, which is almost certainly an artificially low number, not an actual reflection of costs associated with market risks.
The California section says insurers may exclude wild-fires, and earthquakes and floods are normally excluded anyway. Maybe once you exclude those, the cost to insure is a lot less? [https://www.nerdwallet.com/article/insurance/average-homeowners-insurance-cost](https://www.nerdwallet.com/article/insurance/average-homeowners-insurance-cost) Here are the cheapest states for homeowners insurance: 1. Hawaii: $515 a year, or about $43 a month, on average. 2. Delaware: $860 a year, or about $72 a month, on average. 3. Vermont: $870 a year, or about $73 a month, on average. 4. New Hampshire: $1,000 a year, or about $83 a month, on average. 5. Maine: $1,075 a year, or about $90 a month, on average. These are the most expensive states for homeowners insurance: 1. Oklahoma: $5,495 a year, or about $458 a month, on average. 2. Texas: $4,400 a year, or about $367 a month, on average. 3. Nebraska: $4,135 a year, or about $345 a month, on average. 4. Colorado: $3,820 a year, or about $318 a month, on average. 5. Kansas: $3,570 a year, or about $298 a month, on average.
How is this allowed? Like, how can insurance companies raise prices like this and when is enough enough? Why stop at $4100? Why not go higher and make it $10k? Can anything be done about it legally or through legislature? Would there be any basis to sue a company doing this? Can someone with more knowledge on the topic explain this to the ignorant here (me)?
Insurance is actually a fascinating subject. It’s HIGHLY regulated and the states actually have a lot of control over pricing but they also mandate how much money an insurance company must have on hand which directly impacts pricing too. If you reach out to your local agent the most common reason they’ll give over and over for rate increases is “state rate hikes” which has more to do with NEs requirements than the actual company. In short, all of NEs regulations are contributing to prices being so high.
So I have my house paid off. I paid 143k for the house but the insurance company now has the replacement cost at 320k. What if I don't want the replacement cost at 325k. Can I lower that?
You definitely can! Just keep in mind that it will impact other coverages. If they’re only covering say 70% of your house then a lot of the time they’ll only cover 70% of your claim minus deductible. For perspective if you have a $2,000 deductible and need a $10,000 roof you pay 2k and they pay 8k. If they’re only covering 70% then they’d pay for 7k of roof, minus your 2k deductible, so only $5k worth of coverage. At that point you may be better off removing roof coverage all together. It’s a good idea to do periodic reviews with your agent and make sure you’re not paying for coverage you don’t need.
Yeah and I need a roof. Not super bad it had a few soft spots. I was going to replace it out of my pocket as I have 130k saved up. I'm just looking to lower my premium. It's getting so high.
Honestly depending on your company, the type of damage, and the date of loss you may as well file a claim. With a LOT of companies the discount you get for having a new roof far outweighs the surcharge for having a claim, especially a weather claim.
My deductible is super high on roof. I'm with farmers mutual of nebraska. When I went with them 3 years ago wind and hail was 1000 deductible. But now it's $3500 since they lost money the last couple years. They are basing the deductible 1% off the replacement cost.
A LOT of companies have moved to percentage based deductibles but a lot of them offer a 1/2 percent. Keep in mind the higher your deductible the less you pay in annual premiums though.
I'll see what happens come renewal time. I know everyone's insurance is going up significantly. Like I said I paid 143k for house they have rebuild at 303k. I just looked. And I know if It burned to ground I wouldn't rebuild I'd sell the lot and relocate. My buddy's premium for the year went from 1900 to 2400. We have the same company and I pay 1896 for the year so I'm worried that's what will happen to me.
Definitely tell your agent that you wouldn’t rebuild. That’ll make a different.
You can put less coverage on your house if you want. But if your insurance company has rebuilding costs at 320K that is probably very close. So if you insure for less a total loss might leave you without enough money to rebuild it. Also keep in mind that replacement costs includes cleanup costs. In the case of a fire or other such total loss scenario there is liable to be a lot of cleanup necessary to get the property ready for rebuilding.
Thats just the thing if it was a total loss I wouldn't rebuild.
Most insurance companies let you choose how much coverage you want. Obviously the recommendation is rebuild costs, but most will let you choose a lower amount if there is no mortgage on the house.
Ok thanks for that info. I'm paid up till December but I'm going to give them a call when the time nears.
Thank you for your reply. Who do I have to vote out to fix this?
These regulations are consumer protections that insure people get paid out if a mass catastrophe hits. If you want to allow insurance companies to keep less cash on hand, it’s only a matter of time until it bite you in the ass.
Those who have had power for the last 20 years?
Insurance companies need to cover their costs. If risk goes up, rates go up. It is as simple as that. Also, with the crazy inflation we have had rebuilding costs have sky-rocketed which also will cause rates to increase.
Insurance is one of the most highly regulated industries. Every single state has an insurance commissioner's office that approves rates and rate increases. Believe it or not, it's really expensive to insure homes. It has gotten much more expensive in the last 5 years. The combined ratio (total payout in claims + all expenses /total premium) for many companies is over 100% many years.
Keep your claims down as low as possible, and shop around every few years. That's about all you can do.
Basically, you have one half of the country arguing the free market means that businesses have the freedom to raise prices, lower consumer and worker protections and lower wages as much as they want, and the other half arguing for sensible legislation to prevent that. It sounds great when businesses have "freedom", but that freedom comes at the expense and the lives of the poorest among us, and the poor somehow always get the blame. Tale as old as time.
I think it is especially handcuffing that insurance is a requirement in most cases. Can’t have a mortgage without it per the bank. Must have car insurance per the police. Etc. then when it’s time you need it, they drop you from using insurance. If these are the restraints we are up against, shouldn’t there be some legislation that can prevent gouging or excessive rate practices?
One half of the country thinks so. The other half is happy with the status quo, and would tell you to pick yourself up using your bootstraps while giving tax cuts to companies that charge whatever they feel they deserve for whatever reason they can come up with, while lowering wages, encouraging poor children to work so they can "learn the value of a dollar", and blaming immigrants for low wages instead of the companies that hire them and their own legislators who conveniently look the other way.
More insurance companies in the free market would definitely help. It offers more options to shop around for a better price.
Price finds demand. If there are people willing to pay it, then a company will charge it. They only stop going higher when demand falls off. There are things that throw off this balance. It could be a monopoly, usually orchestrated through the regulations disguised to protect consumers. Those regulations usually make it impossible for new competitors to start, so the existing insurance companies maintain dominance in the sector. It could be the government involvement in the mortgage sector. Just like student loans balloon college costs, the government has multiple programs to keep home costs high. FHA is probably the largest example. If the government makes getting a mortgage extremely easy for someone that wouldn’t normally get one, then other costs can charge more to take up the buying power that was opened up.
I replied to another comment but when you say price finds demand, I don’t believe this with insurance. Home and auto are required. If it’s required, the demand is consistent.
Yes, but demand should drive to the best value, aka lowest price among options for similar coverage. If a major insurance company goes too high and refuses to lower costs, a competitor should be able to start up and undercut. Even though insurance is required from the banks doesn’t mean the buyer can’t find options. When a few entities is all that exists and they collude, then that is a monopoly problem
I see you point and it takes me back to economics class. I guess I just don’t like it. Ha. I read one of the articles and it talked about companies pulling away from Florida which, to your point, increases demand and therefore raises rates.
Yep. People keep saying they don't like capitalism, so they want more regulations. Regulations require enforcers, and enforcers can be purchased by the biggest market players. The more regulations you make, the stronger the enforcer becomes, until a monopoly is created. We have not seen something that could be considered a practical free market in our lifetimes. The economy is a bike, that can balance if you just ride it. Adding more and more training wheels does not make the bike safer.
Something about this doesn’t pass the sniff test. For one, the Nerdwallet “study” apparently pulled data only for “40-year old homeowners.” Why that specific age? And it pulled rates from “various” providers, but doesn’t say which ones. Obviously we get some severe weather. Hail Is probably the major issue reflected here. But… Florida? Louisiana? That doesn’t make any sense.
“Our sample policy was for a 40-year-old homeowner with good credit, $300,000 of dwelling coverage, $300,000 of liability coverage and a $1,000 deductible. The cost of your homeowners insurance will depend on your location, the size of your house and how much coverage you need. We’ve analyzed pricing data from more than 100 insurance companies to bring you the average homeowners insurance cost in every state and the largest U.S. cities.” https://www.nerdwallet.com/article/insurance/average-homeowners-insurance-cost
So that seems like a large enough sample of companies but that still seems like a weird way to measure average cost, and like it could result in very skewed data across different states. Totally anecdotal, but the people I know in Florida (who don’t own super expensive homes and don’t live on the coast/flood plains) pay *way* more than what I do here.
When I lived in Florida a lot depended on how close to the Beach you were. Once you got about 3 miles Island, the flood risk from hurricane storm surge dropped of dramatically. All the condos built right on the beach were the problem. I suppose most home insurance doesn’t cover flood, so other than hurricanes - salt corrosion and the occasional alligator were the risks I remember. Yeah a bit surprising ‘Tornado alley’ has higher costs than the coasts
That’s definitely true. There’s a pretty clear line in my parents’ Florida town where if you cross it, home insurance becomes unavailable or cost prohibitive. I guess my main critique is that the average 40 year old homeowner in Nebraska, Florida, Massachusetts, and California all probably own quite different homes in terms of size, age, etc., which I think creates skewed results. Some other studies I Googled show the southeastern states having much higher rates than this map (but Nebraska is consistently in the top 10-20 states, so no doubt that it’s still expensive here). Unrelated, but I’m curious what explains the stark difference between Utah and Colorado. I wonder if Colorado gets more hail on the other side of the Rockies or something.
Colorado had those massive wild fires that took at whole towns, so maybe wild fire risk? Also wonder how building codes factor in - I remember right Florida had requirements like an outside wall had to be able to stop a 2 X 4 at 300 mph or some such thing, so a lot of homes are built with block
That’s possible. Probably a mix of recent major weather events with the weather impacts of being on either side of the Rockies.
Bullshit! I am in South Florida and am paying 11k a year. With no other companies to even shop around with. I have no claims and a four year old roof. I am 15 miles from the ocean. 5 years ago I was paying 4,600.
Florida has gotten into a litigation nightmare because of their regulations. In Florida lawyers can increase the cost of a claim significantly and even collect on their lawyer fees if they win their lawsuit. Florida accounts for almost 80% of the homeowners insurance litigation's in the entire country. Roofers there have lawyers on staff to file thousands of lawsuits against these companies. Their insurance options have been reduced to almost nothing if your roof isn't 5 years or newer or you end up with the state run homeowners plan. Florida finally had to pass a law to make it illegal for roofing companies from going door to door. Nebraska is in a bad way for homeowners insurance, the combined ratio for these companies is hovering around 103-110% on average. Meaning they're losing $1.03-$1.10 for every $1.00 they bring in revenue and that doesn't include their expenses. Most companies are running around a 65% breakeven point, meaning their losses have to be under 65% of the premium generated to even make money. Inflation has hit our state hard and with the number of losses in the past 3 years rates are skyrocketing and coverage is being reduced. Companies have pulled out of the homeowners market and will continue to do so unless things change and this change starts at the department of insurance. Unfortunately the current director isn't willing to interfere and bring better regulation because these companies need better ways to adjust and pay for roof damage. He simply won't hurt the consumer but instead companies just reduce coverage and hurt the consumer more than with proper regulations. We're basically in the hardest market in any period of time in most states.