Insurance BS

I am a homeowner.  Well, I am a mortgage payer.  I am 8 years into a 30 year note.

I am required by law to carry insurance on the property.

I am getting sick of my home being held hostage by the insurance company.

I have 22 years of paying whatever they decide to charge or I lose my house.  It changes every year and it's always up.

We paid $69,900 for our house, borrowing $66,400.  On the day of sale in 2004 it was valued at $72,500 (assessed market value).  Our mortgage is $487.22 and our payment was $562.30 for the first year.  Less than $100 for taxes and insurance a month (the escrow was flush at the time).

My annual taxes run just a bit over 1% of the assessed value about $65 a month when we signed.

Today the house is assessed at $49,538.  My payment is now $701.12.  My taxes are $532.38 a year ($44.37 a payment).  So, $701.12 - $487.22 - $44.37 = $169.53 a month for my homeowner's insurance.  When we signed it was $50.08 a month!

Why is it that my property has lost 31.6% of it's value but it costs three times as much to insure it?

There's a word for it.  FRAUD.  People making false claims.

Again, I am being punished for the actions of others who are not being punished at all.

To top it off there's going to be a 10% increase in my insurance rates forever and likely a 183% increase in the sink-hole portion of my coverage this year.  All because the state did nothing to prevent fraudulent claims.

I am even more cheesed off that the company I am forced to use is owned by the state.  The bastards make a profit.  Nothing owned by the government should make a profit; it should break even at best.

The main reason I am forced to use the government owned solution is because rates have been kept artificially low by law and most private insurers stopped writing new policies.  However, the actuarial calculations have been going up faster than the values of the properties they are underwriting.  And if value exposure is the key part of the equation, like they say it is, why don't my rates go down now that my house is worth less than when I bought it?  They sure as hell went up in 2006 when the assessed value of the place was $96,200!  And went up in direct proportion to the assessed value.

At some point we have to let insurance charge what it costs to insure people.  I no longer believe that either side, government or insurers, are being honest about that cost.

It appears to me that much of the actuarial equation is to sneak (needed) rate increases around laws that forbid rate increases.  Even if this is successful, the insurance companies still lobby to have the rate increase barriers removed.  If the government relents and allows that rate increase, the actuarial weasel increase remains.  Thus we are now paying more for the same coverage.  Government suspects this is true and puts a law in place forbidding increases...  lather, rinse, repeat.