Lori Chamber…, Home Buyer in Chicago, IL

Hazard insurance for investment property - why has it increased so much and do you know of any affordable optioms?

Asked by Lori Chamberlain, Chicago, IL Thu Sep 19, 2013

I have a duplex in Broadripple that has traditionally had affordable hazard insurance. I have checked with a couple brokers and our insurance for this year has almost tripled. We have never made a claim in 7 years. Help!

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Answers

3
Try calling my son, James Knight, (317) 319-9099. He is an Independent Insurance Broker and has access to several different underwriters. He knows Broadripple and may be able to help you.

Peter Knight
(317) 529-4178
0 votes Thank Flag Link Thu Sep 26, 2013
There are two primary reasons I can think of that would cause your rates to go up. There are many more reasons but these two are the most likely.

Unfortunately Lori, insurance companies do only increase rates if YOU have a claim. They will also increase rates if an area is having high claim frequency. If the insurance company is paying out $3 for every $1 they collect in an territory, they will increase the rates to get back to profitability so they can stay in business and continue writing insurance.

The other reason your rates could have gone up substantionally is if your insurance agent either didnt know or didnt care that the property was a multifamily property. They may have mistakenly written your insurance policay as a single family home. Single family homes are less expensive because they only insure a single family. Multifamilies are more expensive because there are multiple families and more risk or potential claim exposures. Insurance companies don't always inspect a home right away. Sometimes they will only start inspecting properties if they are trying to get control of losses in a certain area. If they did an inspection and discovered the property was a multifamily, the rate will go up substantionally.

We write properties in Chicago if you would like to give us a try. I wish you the best.
0 votes Thank Flag Link Fri Sep 20, 2013
If the home was not in a flood plain before, it could be now. Contact me and we can chat.

Tori Myers
Century 21 Scheetz
(765) 434-2838
0 votes Thank Flag Link Thu Sep 19, 2013
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