JULIE GARDNER
  • HOME
  • COMPASS
    • WHY COMPASS?
    • COMPASS CONCIERGE
    • COMPASS BRIDGE LOANS
  • LISTINGS
  • ABOUT
    • ABOUT JULIE
    • A DYNAMIC PARTNERSHIP
    • CONTACT
    • PROCESS
    • TESTIMONIALS
    • PRESS
  • PROJECTS
    • BEFORE & AFTER
    • GARDENS
    • OUR TEAM
    • VIDEOS
  • BLOG
  • COMMUNITY
    • UTILITIES
    • SCHOOLS

The Skinny on Insurance

2/5/2016

0 Comments

 
"How's your mother-in-law's apartment?" my client asked. "I loved the piece you wrote about the rain because we were going through exactly the same thing," Allan confided with a small laugh (patriots in arms). We had an inch of water in the lower level room to mop out the next day."
And Allan and I weren't the only homeowners suffering. Nothing brings phone calls to roofers, contractors, insurance agents, and Realtors alike, like a torrential downpour.  As welcome as the wet weather is for our badly depleted reservoirs and anemic water table, record amounts of rainfall in the span of a few short hours can truly wreak havoc if it has nowhere else to go but inside, as was my case, and obviously, my fellow deckhands. Luckily, Allan and Kathryn are only half way through their own remodel so at least they still had linoleum floors in place - which is why Allan can still laugh about it and I'm finding it more challenging to  . . . (Grrrr.)

As I mentioned in that soggy tale, water from outside is considered "flood water" so my insurance won't cover it as the house isn't insured for "flood damage." Gratefully, my floor contractor, Alvaro, will.

"Don't worry, Julia, we will fix this. You don't need to worry 'bout nothing beautiful lady."

"Gracias." (Alvaro is the best. I may have found my soul mate. Sorry Cliff.)
  
On the heels of many similar stories, DJ invited Jorge Mancheno, a 20-year insurance veteran and owner/broker of Mancheno Insurance Agency, to visit The GRUBB Co. team at this week's Tuesday morning meeting to talk about the topic on everybody's mind these days - insurance - and what is and more importantly,what isn't  covered. So while insurance may not be the sexiest of topics on which to begin our day, as homeowners, we need to know this stuff so we can be well-informed consumers and better prepared for the next BIG storm that comes along. (Jorge has seen it all in his 20 years of selling homeowner's insurance.)

Jorge began his presentation by encouraging us to have "the insurance discussion" with our home Buyers well before the close of escrow, because not all houses are created equal from an insurance standpoint and some, can be nearly impossible to insure without great cost to the owners. That's not something you want to find out after you've removed your inspection contingencies and while waiting for your loan to fund. (Note: NO lender will fund without homeowner's insurance in place!) Smart Insurance Agents will happily supply a complimentary quote for you on a designated property before you even make an offer. 

Forget aesthetics for the moment and whether or not you crave a view.  Here are the basic questions you need to ask yourself when looking at homes and the BIG red flags to consider as they pertain to Real Estate purchases:

1) Does the house have a wood shake roof? (A BIG no-no!)
2) Does the house have original knob & tube wiring? (Many companies won't insure knob & tube.)
3) Is the house located in a high-brush zone? (Most of the hills are heavily identified as "high-brush" zones and require ongoing maintenance and clearing.)
4) Is the house located in a flood plane? (Is there a creek nearby - even one that has been culverted, or a reservoir above the house?)
5) What is the slope of the lot the house sits upon? (Insurance companies don't like slope that is more than 30%. Vertical view homes often surpass this requirement.)
6) Does the home have a brick foundation? (Only out-of-state insurance companies will insure brick foundations.)

The news wasn't all "Debbie Downer" as insurance discounts are available for homes that have undertaken extensive renovation (finally, a break.)and there's a little known gem for couples who are both AARP members from Hartford wherein your insurance is locked in for life. Moreover, Jorge assured us that even the toughest homes are still able to find insurance from companies willing to take on the higher risk here in the state of California - but at a much heftier price tag!

As for earthquake insurance?  This is the $64,000 question and one that's up to each individual to determine. However, the consensus seems to be that if you have at least 40% equity in your home, earthquake insurance is probably a good idea. (Structural engineers would tell you to spend those premiums on earthquake retrofitting instead (earthquakebracebolt.com). But should the big one come along and you find your house to be nearly destroyed and uninhabitable, the next big hit is going to be your DEDUCTIBLE (!!!) which is (drum roll please) 15% of your home's value! Yikes.
  
Say What!?!
  
That's right, thus a home worth $1,000,000 is going to require $150,000 cash out-of-pocket before your earthquake insurance kicks in. In other words, damage under $150,000 isn't going to be covered at all and if your home's replacement value is $3 million - well, than you do the math; $450,000 is a hefty chunk of change to find under the sofa cushions. (Gee, that doesn't seem exactly fair.) 
  
Hmmmm. I'm thinking that when the big one hits, I may need a match. Evidently, fire from an earthquake IS covered under a homeowner's insurance policy (NOT under earthquake insurance), but the cracked foundation isn't and if your house tumbles down the hill, forget about it - that's an "act of God." (Okay, okay, only kidding. Please keep my insurance in place. I promise to pay my premiums on time.)

​How can I help you?
0 Comments

Your comment will be posted after it is approved.


Leave a Reply.

    Subscribe

    Author

    Julie Gardner, has been writing The Perspective for 18 years and has published more than 775 humorous but always informative, essays on life and real estate. 

    Picture

    Archives

    May 2025
    April 2025
    March 2025
    February 2025
    January 2025
    December 2024
    November 2024
    October 2024
    September 2024
    August 2024
    July 2024
    June 2024
    May 2024
    April 2024
    March 2024
    February 2024
    January 2024
    December 2023
    November 2023
    October 2023
    September 2023
    August 2023
    July 2023
    June 2023
    May 2023
    April 2023
    March 2023
    February 2023
    January 2023
    December 2022
    November 2022
    October 2022
    September 2022
    August 2022
    July 2022
    June 2022
    May 2022
    April 2022
    March 2022
    February 2022
    January 2022
    December 2021
    November 2021
    October 2021
    September 2021
    August 2021
    July 2021
    June 2021
    May 2021
    April 2021
    March 2021
    February 2021
    January 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016
    April 2016
    March 2016
    February 2016
    January 2016
    December 2015
    August 2015
    July 2015
    June 2015
    May 2015
    April 2015
    March 2015
    February 2015
    January 2015
    December 2014
    November 2014
    October 2014
    September 2014
    July 2014
    June 2014
    May 2014
    April 2014
    March 2014
    February 2014
    January 2014
    December 2013
    November 2013
    October 2013
    September 2013
    August 2013
    July 2013
    June 2013
    May 2013
    April 2013
    March 2013
    February 2013
    January 2013
    December 2012
    November 2012
    October 2012
    September 2012
    August 2012
    July 2012
    June 2012
    May 2012
    April 2012
    March 2012
    February 2012
    January 2012
    December 2011
    November 2011
    October 2011
    September 2011
    August 2011
    July 2011
    June 2011
    May 2011
    April 2011
    March 2011
    February 2011
    January 2011
    December 2010
    November 2010
    October 2010
    September 2010
    August 2010
    July 2010
    June 2010
    May 2010
    April 2010
    March 2010
    February 2010
    January 2010
    December 2009
    November 2009
    October 2009
    September 2009
    August 2009
    July 2009
    June 2009
    May 2009
    April 2009
    March 2009
    February 2009
    January 2009
    December 2008
    November 2008
    October 2008
    September 2008
    August 2008
    July 2008
    June 2008
    May 2008
    April 2008
    March 2008

    Categories

    All
    Business
    Design
    Drought
    Holiday
    Home Maintenance
    Homes For Sale
    Life
    Market
    Politics
    Renovation

    RSS Feed

    View my profile on LinkedIn
Piedmont · Oakland · Berkeley
 510.326.0840
[email protected]
DRE# 01431765
​COMPASS

  • HOME
  • COMPASS
    • WHY COMPASS?
    • COMPASS CONCIERGE
    • COMPASS BRIDGE LOANS
  • LISTINGS
  • ABOUT
    • ABOUT JULIE
    • A DYNAMIC PARTNERSHIP
    • CONTACT
    • PROCESS
    • TESTIMONIALS
    • PRESS
  • PROJECTS
    • BEFORE & AFTER
    • GARDENS
    • OUR TEAM
    • VIDEOS
  • BLOG
  • COMMUNITY
    • UTILITIES
    • SCHOOLS