Is Our Home Insurance System Completely F#cked?
Plus, how my home — not flood — insurer broke up with me.
Hey readers,
Quick clarifying note here: Like most of my newsletters, this one is late. But this time, it’s not my fault. There was a technical issue that prevented the issue from sending, and I needed Substack tech support to help resolve it. Anyway, back to the latest newsletter.
A few months ago, The New York Times published an explosive report (an audio version is available here) on the precarious state of the home insurance industry and the role of climate change in it.
According to Christopher Flavelle, who co-authored the report with Mira Rojanasakul, climate change — and the extreme weather it causes — is impacting the industry in the following ways:
“Insurers are spending more to fix damaged homes as disasters intensify. In response, they’re raising rates, squeezing homeowners already struggling with rising mortgage costs, and even abandoning some markets altogether.”
The Times report was shocking to some, but thanks to RPR reader Tara, I’ve been aware of the state of the insurance industry for a while now. Climate change may not be the only factor driving the insurance industry toward the abyss, but it’s by far the most volatile and unpredictable one. If you want a glimpse of where we’re headed, look no further than Florida and California.
And if you’re policyholder who suddenly finds yourself without a home insurance policy, it can be quite jarring.
I understand how those scorned policyholders in the Times report feel. I recently broke up with my longtime home insurer (not the company that provides our flood insurance). Like a shit significant other that didn’t have the integrity to be upfront about why the relationship wasn’t working, Travelers Insurance made a bunch of confusing, contradictory and ridiculous demands and claimed I was the one who wasn’t committed to relationship when I didn’t follow them.
First, I got a letter from my friends at Travelers saying an inspection of the property (via drone photos) revealed “preventative property maintenance item(s) that require your attention to maintain your insurance coverage — Main Dwelling: Tree(s) that are overhanging, touching structure needed to be corrected.”
WalMart Jeremy Piven
Seemed a little weird that the trees on my property never really bothered my backstabbing former insurance partner during the previous seven years I lived there, but instead of complaining I did the responsible thing and called my agent, who immediately promised to get to the bottom of the situation. Two days later I get a call from said agent, and he’s ecstatic.
“Jared, How are ya, bud? Got some fantastic new for ya, bud. You’re gonna love this,” he said the moment I picked up the phone.
(Reader note: I think my insurance agent watched a little too much Entourage in the early aughts, and although I’ve never seen him in person, I fairly certain he looks like WalMart Jeremy Piven or WJP.)
“Yeah,” I said.
“You betcha,” WJP replied. “Spoke to somebody over at Travelers, and this all sounds like one big misunderstanding. Listen, all ya gotta do is send over a few pictures of the house to prove to these Jabronis* at Travelers that no trees are actually touching your structure. Can ya do that, bud?”
This bud did just that. I took a bunch of photos clearly demonstrating that no branches were touching my roof, patted myself on the back for doing what I was supposed to and promptly forgot about my home insurer and my eccentric agent.
Fast-forward to mid-April. I get a Notice of Cancellation from Travelers. Naturally, I start bombarding WalMart Jeremy with calls and emails, asking him what the hell’s going on with my policy.
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“I did exactly what you told me to, and now they’re saying my insurance is being canceled. What the hell is this?” I barked at WJP when I got him on the phone.
The poor guy couldn’t even muster up a glimpse of his usual energy and positivity. “Listen, the person I spoke to at Travelers made it sound like the pictures would take care of everything. I’m gonna find out what this is about, just give an hour or so,” Dejected WalMart Jeremy Piven (DWJP) told me.
Contradictory information
Here’s where things get interesting. The problem, according to WJP, the issue was overhanging branches above my roof — not branches actually touching my roof like he’d initially suspected. (Apparently this is a fairly common tactic insurers have been employing lately.)
My frazzled agent told me he spoke to several people at Travelers and couldn’t get a straight answer on what I needed to do to keep my policy, suggesting that the company was trying to drop me.
I decided to investigate for myself.
A series of phone calls with Travelers followed, each resulting in me receiving different requirements on what was necessary to maintain my home insurance policy. It all came down to overhanging branches above my roof. (Apparently this is a fairly common tactic insurers have been employing lately.)
One person said the big oak trees (plural) in front of the house needed to be trimmed so that no more than 33% of the roof had overhanging branches; another said that the tree on the left side of the house needed to be cut down completely; and yet another Travelers lackey said I needed to cut down both of the trees in front of the house.
When we brought in a tree trimming/removal company for estimates, my kids overheard the guy saying we should probably just cut down one of the trees, and they lost it. Both of them started crying hysterically and screaming that they hated me for killing their trees.
Eventually, Agent Piven found us a policy through another carrier, and we officially parted ways with Travelers.
But this isn’t over yet. The sixth-largest writer of U.S. personal insurance through independent agents will be hearing from my trusted advisor, Kenneth Larson soon.
* Okay, fine. Maybe WJP didn’t actually use the term Jabronis.
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