Best Answer

you could be experiencing a number of different things, here are a few;

  • insurance companies do regularly increase their premium amounts, however this increase is generally going to reflect the standard rate of increase in any other market. This is done for the same reason other companies do it, to remain profitable in the face of inflation.
  • some homeowners policies have a feature that causes them to renew each year at an increased coverage amount. This feature is in place in order to attempt to keep you fully covered on your home since most homes increase in value over time.

in both of the above cases, you should request a copy of your insurance declarations page to determine what coverage you have, how much coverage you have, and how much your premium is. If you find that your coverage has increased, and you believe it to be too high, you can contact your agent and have your policy changed. Be advised, however, that your mortgage company is going to require a minimum amount of insurance coverage on the property in order to protect their interest in the property. It is in your best interest to meet this coverage requirement, otherwise the lender will issue a force placed insurance policy. In almost every instance, these policies are many, many times more expensive than a voluntary policy. The reason for this is because they are not underwritten, meaning they are issued sight-unseen, this means that the risk to the insurer is much greater, therefore, the premiums will be much higher. The minimum requirement for your property is going to depend on who your lender is, but for almost every lender this amount will be at least as much as your unpaid balance, but in most instances it will be the replacement cost of the home, which leads me to the third point;

  • replacement value is determined by your insurance company, and it is a fair market estimate of what it might cost to completely rebuild your home from the ground up. If you feel that the replacement value that the company has for your home is too high, then you can discuss having the value changed. This will usually require either a.) a property appraisal which can cost a couple hundred dollars or b.)a property tax valuation statement from your state tax assessor. However, be advised that a tax assessment is often a poor representation of the actual value of your home.

I would suggest that you speak with your insurance agent, they should be able to explain everything to you in detail, and should be able to offer you some guidance. additionally, if you are unable to get any help, you may consider switching insurance carriers so that you can find a more reasonable company.

hope this helps!

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Q: Who is in bed with citizens insurance that allows them to increase home owners insurance every year This has put unfair and burden on homeowners that are barely able to make their home mortgage?
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