Is the home insurance industry the biggest scam in the united states?
Upon viewing Spike Lee’s documenatry on Hurricane Katrina, I was dismayed on how the insurance industry failed to live to their end of the bargain for the people who lost their homes. As a homeowner I have to question whether to continue to hold insurance based on what I saw.
Tags: biggest, home, industry, Insurance, scam., states, United
no, the auto insurance scam is
if you have a mortgage in most states you have no choice but to have home owners insurance. read the fine print.
NO – work comp insurance is the biggest scam in the WORLD.
98% of people that THINK they have carpel tunnel DON’T HAVE IT. Yet they still get paid for it!
It depends on the insurance company you use. If it is a REPUTABLE company, the people had NO problem getting paid. But the fly-by-night companies that offer insurance for practically no money DO NOT pay when it comes time to. I guess you get what you pay for.
If you have a mortgae, not having insurance is probably not an option, since your bank will require it. If you have no mortgage there are several reasons why you may want to take the risk and go without it. If your home is solidly built, the chances of coming out ahead in the long run by not having insurance are very good. When you consider how much of your premium goes to commissions, marketing and administration, self-insuring can be very profitable.
You’ve got to be kidding me? When is it ok to only hear one side of a story? When an insurance company pays claims that were not anticipated in the setting of their rates, they sacrifice the ability to protect the rest of the insureds.
Contrary to what many people believe, insurance companies do NOT have unlimited funds. They have budgets to balance just like we do at home. Of course the budgets are bigger but they also have thousands and millions more responsibilities to cover including thousands of employees, etc. I really get tired of hearing people slam insurance companies based on NO INFORMATION. Go ahead and drop your insurance on your home. I’m sure that, if something happens to your home, all your friends will donate $ to help you rebuild. Ha!
I think I’ll build my home on the side of a mountain. When storms and tremors cause it to collapse, you’ll all pitch in and pay for me to do it again, won’t you?
No insurance is not a scam. I will agree with you that certain companies involved in Hurricane Katrina claims have done a poor job. Insurance companies actually pay out an average of 98 cents for every dollar in premiums they collect to claims. Insurance companies make most of their money from investments. If you personally don’t want insurance just ask yourself if you can retain all the risk if you do face a loss, because all insurance is doing is transferring risk of financial loss from you to the insurance company. If you can’t afford to rebuild your home if it burns down you might want to keep your insurance. Also with regards to flooding such as Katrina, make sure you have a flood policy if you live in a flood zone. Many of those homeowners did not. Homeowners policies don’t cover flood.
Well, if you have a mortgage on your home, you have no choice but to have homeowner’s insurance. So it really doesn’t matter whether you think it’s a scam or not.
Typically “acts of God” are not covered by homeowner’s insurance. This shouldn’t have come as a surprise to the people in New Orleans. It’s very unfortunate, but I am sure it was clearly disclosed in the policy language.
A lot of dissatisifaction here in Louisiana was due to the fact that people didn’t buy FLOOD insurance. Then they expected their Homeowner’s carrier to pay for their flood damage, and NO homeowner’s policy covers the risk for rising water. People didn’t buy flood insurance, despite the fact that we all live in flood zones here, because it was cheaper not to buy flood. The only reason most people even buy homeowner’s insurance is because their mortgage company forces them to insure their risk for the value of the loan. Now we’re all suffering because no one wants to write insurance in southeast Louisiana. For a $200,000 home you can expect to spend over $5000 a year in homeowner’s premiums IF anyone will write your policy at all. On top of the tremendous losses they incurred, if you also try to make those companies pay for something that they’re homeowner’s policy has always excluded, they will never write insurance here again (thank god they lost their law suit against homeowner’s carriers, or we’d never have property insurance here again). If that’s the case, there will be no way for us to protect our investment in our home. And you live in a place where property insurance is available to you and you don’t WANT it anymore? That’s crazy.
Christie- A Hurricane is not considered an Act of God in that the carrier excludes it. Hurricane damage is covered on a HO under Wind & Wind Driven Rain. If the wind ripped off your roof, then it rained on the second floor for 8 hours, your HO policy had your covered. HO policies in Louisiana didn’t exclude wind prior to Katrina. However, most of the damage in New Orleans was rising water, no covered by the HO. And a massive amount of people were without flood insurance.
Claims didn’t get settled as fast as we all wanted them to. Mine took 13 months to be settled, then it had to be reopened for 4 months. But can you blame the company for being overwhelmed with an unprecedented catastrophe? Good companies did pay fairly. Assisted Living Expenses couldn’t be paid to insureds FOREVER. A lot of people didn’t even realize what kind of coverage they had before the storm. This is what caused so much dissatisfaction. It was a giant clusterf**k. But the worst part of Katrina was sitting around in the Stone Age for a WEEK listening to radio broadcasts that bodies are floating through the Bywater before the Red Cross, FEMA, and the President decided to show up. If “When the Levees Broke” moved you, I’m happy. But don’t uninsure your home. If you want to do us a favor in Louisiana wait until the 2008 election.