Transcript
Ryan Reynolds (0:00)
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Mint Mobile Announcer (0:22)
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Indeed Announcer (0:28)
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Clark Howard (1:04)
It's great to have you here on the Clark Howard Show. You know, our mission is to serve you with advice and information that empowers you so you make better financial decisions in your life. Today I want to talk about some stuff with homeowners insurance. You got to know when you're looking for a house or you already have one. Homeowners rates have been causing such a burden on people and so many places in the country. We need to talk strategy later. So crypto goes through cycles of being really talked about, a lot of buzz, a lot of speculation and then it will kind of fade and then it comes back. And right now crypto is having a moment again. People talk about as alternative investments. And I'm ready because I know every time I talk about crypto, how many Clark sinks will we get? How many dozens? About just that. Well, I'm always willing to step into it and I'll do that later in this podcast and YouTube show. So there's a new report on how much and how little homeowners insurance is going to go up in different places in the country. This report that was put together based on data from several different organizations. The write up I saw, and it's not exclusive to them, but it was a fast company story. And some of the increases that are coming in homeowners insurance are exactly where you'd expect. New Orleans, which is below sea level. The premium increase is coming there over the next many years, over 600% the best estimate, 634% increase in homeowners insurance from where it already is, which is not a bargain. Miami, Florida, 590%. Pinellas County, Florida, which is St. Pete. Clearwater, 451%. Duval County, Florida, which is Jacksonville, 333%. You're getting the idea. And then you look at California areas subject to wildfires, premium increases depending on the county, 250 to just under 300%. I mean these are big ugly numbers from already high premium levels. The areas being affected by the big run ups and premiums are in a relatively small number of geographic areas in the country. Surprisingly, there are some places in Texas that are going to see very high increases. One, not surprising at all, Galveston, which is suffered from a lot of flooding and hurricane damage. So when you think about where we're headed with costs, you can start with areas that are likely subject to wildfires. We just saw the tragedy that hit Oklahoma with wildfires. And on this chart, parts of Oklahoma are going to have some of the highest increases in homeowners insurance in the country. Highest percent increases. And they're not anywhere near a coast. So we think coastal. But there can be a number of factors that when you're thinking of moving to an area and you're all excited about it and you're thinking about what it's going to cost to live there, what do we think first, what's the house going to cost? Right. But what is owning that house going to cost? An example in Texas where it can be a bad 2 for property taxes in Texas tend to be very high. And now we've got these coastal regions in Houston seeing potentially very large increases in homeowners insurance. I want you to be realistic. When you're looking at buying a place along a coastal area, what's the all in going to cost you? Not just what it costs to buy the place, but the other things you have to pay for. I'm not trying to be a spoil sport or, or ruin things for you, but I want you thinking about them and just generally around the country with homeowners insurance, we tend as consumers to make two mistakes. One, we have a deductible way too low on our homeowner's insurance. Two, we don't have enough coverage on our homeowner's insurance if something bad happens. So deductible, I want your deductible to be as high as your mortgage company. If you have a mortgage on your home will allow you to have. If you don't have a mortgage, which a third of people own homes roughly don't have a mortgage, I want you to have the highest deductible you can stand because you don't want to make small or moderate claims against homeowners anyway because now they'll just cancel you and then others don't want you because you had a claim and you got canceled. So you want to use and think of homeowners insurance is being for catastrophes. And with the run up in the cost of construction and the value of homes, a lot of us are way underinsured on our homes. So what I want you to do is at the low end, be your own insurer. Low end. I mean, the initial costs that would in the past maybe have been a claim and then at the high end, a major claim. I want you to make sure you have enough coverage and be willing to shop around for homeowners because we think they're loyal to us. Generally, they're not.