Home insurance is an important investment for any homeowner. Along with your personal property, homeowners insurance covers your dwelling against many different events, including fire, wind damage, vandalism, and theft. Broadcast Retirement Network’s Jeffrey Snyder discusses the home insurance marketplace with AssuredPartners’ Michael O’Connor.
Jeffrey H. Snyder, Broadcast Retirement Network
(0:04) This morning on BRN, what you need to know about getting homeowner’s insurance. (0:10) Joining me now to discuss this is Michael O’Connor of Assured Partners. (0:15) Mike, so great to see you, happy new year.
(0:17) Thanks for joining us in the program this morning.
Michael O’Connor, Assured Partners
(0:19) Yeah, thanks for having me, Jeffrey. (0:21) Great to see you as always.
Jeffrey H. Snyder, Broadcast Retirement Network
(0:22) It’s always great. (0:23) Tell me, maybe when spring training starts, we can actually have you back on and talk a little baseball. (0:29) That probably would be fun to get your perspective.
(0:31) But any event, I wanted to touch base with you and talk about homeowner’s insurance. (0:37) Given all the things that have gone on this year and last year with North Carolina and the hurricanes, Florida, the LA fires, what’s a good rule of thumb in terms of finding homeowner’s insurance regardless of where you live?
Michael O’Connor, Assured Partners
(0:54) Sure, I mean, it’s definitely been a tough time for our industry. (0:58) I mean, my thoughts and prayers to all the people that are dealing with all this stuff in California right now. (1:02) I mean, it’s a terrible situation.
(1:05) As far as finding insurance, I mean, it is a tough market. (1:10) There’s carriers that are still writing business, but it is harder and it’s more restrictive and there’s more questions to it. (1:18) I mean, we have plenty of markets that will still write in any market, but it is definitely a more restrictive process and you’re gonna have to give up more information in order to get the best rates.
Jeffrey H. Snyder, Broadcast Retirement Network
(1:33) And Mike, is my understanding correct that if you have a mortgage, you do need to get some level of homeowner’s insurance? (1:40) Is that correct, regardless of whether you’re in the District of Columbia or North Carolina or Maryland or California?
Michael O’Connor, Assured Partners
(1:48) That is correct, Jeff. (1:50) And yeah, if you have a mortgage on your home or property, you are gonna be required to have homeowner’s insurance. (1:57) Even with folks that don’t have a mortgage, I do think it is good risk management as a lot of folks are relying on the equity in their home as part of their retirement plan.
(2:07) So I think insurance is an important part. (2:09) If something terrible does happen, that you do have some recourse to recover from that.
Jeffrey H. Snyder, Broadcast Retirement Network
(2:14) Yeah, I’m thinking about, as you mentioned earlier, thoughts and prayers to those in California, North Carolina, Florida, many people lost their homes, homes that have been in their families for so many years. (2:25) Mike, in general, does homeowner’s insurance include damage for flooding, tornadoes, hurricanes, some of the weather events that people can experience?
Michael O’Connor, Assured Partners
(2:40) Sure, yeah, there’s definitely restrictions to policies. (2:43) I mean, all homeowner’s policies are gonna exclude flood and earthquake. (2:49) Depending on where you are, Florida, you may have to buy a separate wind policy.
(2:53) So I think you have to be aware of what that is. (2:56) I think a lot of times, some people are purchasing insurance directly and it’s a confusing industry for a lot of folks. (3:03) It’s not always transparent.
(3:05) I mean, that’s our job as an independent agent to help people understand the policies that they’re buying and the risks that they might be self-insuring like flood and earthquake.
Jeffrey H. Snyder, Broadcast Retirement Network
(3:16) Yeah, I mean, certainly it’s important and that’s where someone of your expertise, I mean, I come from the retirement industry, as you know, and the audience knows, that industry has a lot of jargon too. (3:27) It’s really hard to unpack and understand all the nuances, all the fees. (3:32) You probably, if you’re not familiar, you probably do need to hire somebody to help walk through and get many bids, right, Michael, to find the best deal possible.
(3:42) It’s not just the cheapest, Mike, it’s also what’s gonna bring the best value for the customer.
Michael O’Connor, Assured Partners
(3:48) Yeah, I think that’s spot on. (3:50) I mean, I think the unfortunate thing with the insurance industry is how it’s marketed based on just price. (3:57) Not all policies are the same.
(4:00) And if you’re not getting certain coverages, there’s a reason why, a lot of times there’s a reason why there’s lower cost options is they’re being more restrictive with certain limits and things. (4:09) So I think it’s for the consumer just being aware of what they’re purchasing. (4:14) And if something does happen, you wanna make sure you do, you’re most likely to have coverage versus having some, you know, bare bones type policy that is low cost.
(4:22) But if something happens, you might not be in a good spot with that.
Jeffrey H. Snyder, Broadcast Retirement Network
(4:27) Yeah, you wanna be able to put in a claim and actually have the claim processed and have someone, you know, hearing stories of adjusters not being able to come out and look at a home and provide the, you know, maybe not cutting a check there, but cutting a check, et cetera. (4:45) Mike, you know, after, earlier on in our discussion, you talked about that there are some carriers that are still running business and some of these heavily, I’m gonna call them risky areas. (4:57) So they’re subject to wind and rain and floods, et cetera.
(5:00) But you said that they may, you may have to disclose more information. (5:04) What does that look like? (5:05) I mean, are they asking for, you know, your birth certificate and social security number?
(5:10) What kind of information would you need to give up?
Michael O’Connor, Assured Partners
(5:13) Yeah, so, I mean, just example, I mean, we work a lot in Florida, you know, you would need to have a wind mitigation certificate and elevation certificate and a four-point inspection done. (5:24) So those are just additional things you need to get in order to get approval or to get the best rates. (5:29) So it’s just an additional step in the process.
(5:32) So, you know, sometimes people are like, oh, why do I, I hadn’t had to do this in the past. (5:38) But, you know, this insurance market has changed a lot. (5:41) Carriers have gotten hit hard by, you know, inflation, increased construction costs, and, you know, just an increase in the amount of natural disasters going on across the country.
(5:51) So they are asking for, you know, more information they have in the past.
Jeffrey H. Snyder, Broadcast Retirement Network
(5:56) And eerily similar, Mike, to car insurance, right? (6:01) I mean, the cost to repair a car, not that you’re in that business, but the cost to repair a car has gone up. (6:07) Labor costs have increased, trying to get parts, all those things.
(6:11) That adds to what the insurance company probably factors in. (6:14) You know, it’s probably like, you know, they’ve got really smart people that do that, but that’s probably what factors into their pricing.
Michael O’Connor, Assured Partners
(6:22) Definitely. (6:22) I mean, we do also offer auto insurance. (6:24) I mean, typically most of our clients are bundling their home in auto as you get, you know, better rates for that.
(6:29) But yeah, the cost to repair vehicles has gone up. (6:33) I mean, just with the amount of, you know, sensors and cameras and things like that and how the cars are built now, the cost to repair a vehicle has gone up significantly.
Jeffrey H. Snyder, Broadcast Retirement Network
(6:44) Mike, is homeowner’s insurance something that you should look at once a year? (6:49) So even if you buy a policy through someone like yourself, is it incumbent upon you as the customer and working with someone like you to review the policy on a regular basis? (6:58) Because as you said, it’s a dynamic industry, it’s always changing and there could be better opportunities out there.
(7:04) So should you look at this at least annually since it’s, you know, January, February?
Michael O’Connor, Assured Partners
(7:09) Yeah, I mean, I think that’s a case-by-case question. (7:12) I mean, if you’re getting, you know, 20% increase, we’re seeing that kind of across the board. (7:17) If you’re getting, you know, above that, I mean, there’s certain markets where you’re seeing 100% or 200% increases.
(7:23) I mean, I think that’s a place where people are definitely gonna look to other options. (7:28) Maybe they find something, maybe they don’t. (7:29) But, you know, I think with the type of increases people are seeing and then, you know, sometimes carriers are asking to remove, you know, wind coverage or other things from policies.
(7:41) So there’s a lot of issues going on. (7:44) I mean, we do get a lot of calls when people are having issues from having claims or things like that. (7:49) So, you know, it does create opportunity for us, but it can be difficult to find a solution for some of these.
Jeffrey H. Snyder, Broadcast Retirement Network
(7:56) Do you think, Mike, that some of these challenges, you know, getting coverage, do you think that gets, is it still worth being a homeowner? (8:04) I mean, we were talking earlier about this is probably your biggest asset and so it becomes part of the retirement plan. (8:10) But with all these kind of hoops you have to jump through, is it, are you seeing customers say, you know, I’m gonna sell my home and I’m gonna move into a condo or an apartment or something and maybe downsize a little bit?
Michael O’Connor, Assured Partners
(8:24) You know, my opinion, I mean, I think owning a home is a great thing, the stability and, you know, money you can build in that. (8:29) But yeah, I mean, I think certain areas, I think people are gonna, you know, have to think longer and harder. (8:34) Is this gonna make sense?
(8:36) Am I gonna, you know, are we gonna deal with issues with storms or are we gonna have, you know, wildfire issues, you know, being in certain higher risk areas? (8:45) So yeah, I think that’s, you know, a decision people are gonna have to make for themselves if they want, you know, to live in South Florida or in, you know, LA after all the issues they’ve dealt with. (8:55) So, I mean, I definitely understand the upside with weather and things living in those areas, but, you know, some of the downside with those areas as far as, you know, insurance costs and, you know, increased costs to live in those areas, it’s definitely something people need to think about.
Jeffrey H. Snyder, Broadcast Retirement Network
(9:11) Yeah, and you got a budget for it. (9:13) You know, I guess it’s one of these things, Mike, that you just have to bake into your budget and be able to afford to afford a home. (9:21) You know, it goes beyond just putting a roof on the house or, you know, mowing the front lawn and doing all those other types of things for your home.
(9:29) Mike, we’re gonna have to leave it there. (9:30) Great to see you as always. (9:32) And look, we look forward to having you back on the program again very soon.
(9:35) Thanks for having me, Jeffrey. (9:37) And don’t forget to subscribe to our daily newsletter, The Morning Pulse, for all the news in one place. (9:41) Details, of course, at our website.
(9:44) And we’re back again tomorrow for another edition of BRN. (9:47) Until then, I’m Jeff Snyder. (9:48) Stay safe, keep on saving, and don’t forget, roll with the changes.
(9:53) Peace.