Condo, Auto, Umbrella Insurance questions

In My Humble Opinion
1

My aunt owns a condo and I was trying to review her auto & condo policy online and request e-bills. The MetLife website is so screwed up I got P.O.'d and decided to look into another company out of curiosity. I tried Progressive since they will give an on-line quote without having to talk to an agent. My first pass at a Progressive quote was less than half MetLife’s cost for condo and auto coverage. That sounded a little too good, so I looked into the huge difference and found some reasons for a good chunk of the difference (more on that later.)

I’ve decided to switch my aunt to Progressive and have a few questions before signing her up.

Not knowing anything about condo insurance, I did some research and found that there are two common types of “Master” insurance that homeowners associations carry. These are often called “All-in” and “Bare walls”. After reading the condo declaration (more than once) I’ve satisfied myself that the master policy is of the all-in type. So, my understanding is that if you turned the condo upside down and shook it, anything that didn’t fall out would be covered by the master policy. I am not clear on whether major appliances are covered by the master policy. I “think” that appliances that came with the condo when new would be covered (although upgrades would not be.) Is this correct? So the condo property insurance would only need to cover personal property and upgrades?

When reviewing the annual copy of the MetLife policy, I found that in addition to home and auto, there was a $1M umbrella policy included. Instead of continuing an umbrella policy I was thinking I could increase the condo personal liability coverage from $100K to $500K and eliminate the umbrella policy. Besides the difference between the 500K and 1M limits, am I correct that the condo liability coverage would cover common off premise liabilities (exceeded auto liability limit, running over someone in grocery store with motorized buggy, etc.)?

Now, for the largest difference in price of MetLife and Progressive policies.

The umbrella policy accounts for about $160 (covered above.)

My aunt replaced her 1995 Corolla car in 2010 with a Scion mini-van. Since then she has been paying for the Scion AND the Corolla she no longer owns! This isn’t quite as bad as I thought since I just now see that the auto premiums are for a full year so the total premium for both vehicles is not greatly in excess of what insuring a single vehicle would cost. But still, obviously she is not getting any benefits from the coverage on the Corolla.

Since she sold her house and bought the condo, there is no (primary) structure coverage now, but apparently the policy (going back how far I can’t image) increases personal property coverage 5% a year. It’s now nearly $200K. :eek: Can’t do anything about that now. However, since buying the condo about eight years ago she has been paying for insurance for building additions and other structures. These were associated with her house, not her condo. That’s another $300 right there.

Is there any possibility of getting any money refunded for what I consider are some fraudulent charges. Don’t insurance companies and agents have some responsibility to not charge for imaginary coverage? I’m pretty sure I can get some money back without much trouble but what is the best way to proceed? In particular, should I contact the local agency or MetLife corporate customer service? Should I bother making a report to any insurance regulatory agency?

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<bump>

3

This is only my opinion, I don’t represent MetLife or Progressive (although I do work for an agent of another company), I am licensed but not in your state, etc.

Why would an insurance company delete a car? Unless they were told that the car was sold, donated or it was non-operational, they naturally would retain coverage on it. I suspect your aunt told them (or had the dealer tell them) to add the new car and neglected to tell them when the old car was sold. Provide proof in the form of a bill of sale, title change or donation documents to the insurance company and they will probably backdate the cancelation, at least to the beginning of the current policy term.

I haven’t read any of the condo documents, including the master policy, so I can only speak in general terms. If the master policy covers the built-in items, then she doesn’t need to cover them with her policy. If it doesn’t cover them, then she does. Appliances or fixtures that everyone assumes would be covered by the master policy (stove, fridge, sink, toilet) oftentimes are considered personal property or dwelling items that the insured must cover. Walls-in generally refers to exterior or shared walls. Interior walls may not be covered. If the condo owner could tear down the wall between the bedroom and living room, that wall could be considered part of the Coverage A- Dwelling. The only way to know for sure is to read the master policy.

Building additions could refer to something like a garden shed or a detached garage. Often, that coverage is included if there is any dwelling coverage. Again, I haven’t read any documents or seen the property so I can’t say if your aunt should remove the coverage.

Personal property is another tricky thing to estimate. I don’t know how much her personal property is worth. I would say that between $50K to $250K is right for someone who went from a house to a condo. But that is a huge range. Again, does that include appliances? What about replacement cost? It is normal for insurance companies to include cost of living increases for the personal property every year. If she has less than $200K, adjust the limits.

Umbrella policies are designed to place excess liability over the insured’s home and auto, extending their coverage for very little cost. Let’s say your aunt caused a horrible accident, causing the other driver to be paralyzed. If she only carried $100,000 per person auto bodily injury coverage, she could be sued and could be ordered by the courts to pay the rest, her wages garnished, and she could have to sell the condo to pay her debt. With an umbrella policy in place, that liability coverage is automatically extended by $1,000,000. Another example: she left a candle burning , caught the drapes on fire and it spread to her neighbors unit. With the umbrella policy, she would have up to $1,000,000 to pay for repairs to her neighbors unit in addition to what her condo policy offers. Remember, the coverages under the personal property and dwelling are for her unit only. Damages to another’s property or person are covered under liability.

Part of the reason she has an agent is to answer questions that may come up. Start with her agent. If she has one, her paperwork should tell who he is. Your aunt should also tell him about the car and ask him how to proceed. It sounds like she gave him instructions, he put the policies in force and your aunt didn’t bother to make sure that he was notified as her situation changed. Give him a chance to address her concerns.

Progressive and other companies that operate huge call centers without going through agents or brokers can save money but you talk to a different person every time you call. If that is OK with you, go for it. If you prefer to deal with the same person every time or want to stop into an office and chat whenever you have a question, see an agent or broker.

4

Thanks for the response.

As I stated in the OP my aunt (79 years old, disabled by polio) is being charged $300 for the insurance for additional building(s) and structures so it’s not “included”. What condominium allows for the building of anything exterior to the unit? I’m pretty sure the answer is none.

You make the case for having an agent instead of going through a big impersonal call center. What’s more impersonal than to not know your customer is an elderly disabled lady who can only drive with the use of hand controls. Why would she need two cars to go to the grocery store and the beauty shop? Where is the personal service from the agent if they can’t even ask if you’re keeping the old car? At least an impersonal call center probably has a script / checklist of questions to ask when there is a change made to a policy.

I’m not ragging on agents in general, I’m sure most of them do provide a good service. But in this case I can’t see any justification for such indifference on the agent’s part.

BTW, I still would like to know if $500K in condo liability coverage would be the equivalent of an equal amount of umbrella coverage.

5

Again, I’m not your aunt’s agent, etc.

If your aunt doesn’t want to be charged for a coverage AND IT CAN BE DELETED FROM HER POLICY, she just needs to ask that it be deleted. Some policies are package policies. If it is a package policy, some coverages are automatically included, whether a need exists for them or not.

In the case of the two cars, did she ever actually specify to the agent that she had sold the car? He can’t read her mind. Should agents automatically delete cars just because a customer says he bought a new car? That will ensure a lot of uninsured cars are on the road!

BTW, I thought I had answered that question. No, umbrella insurance is not the same as the condo liability coverage. Umbrella policies extend the home and auto liability coverage and come into play as soon as the limits on the home or auto are reached. If your aunt wants to delete the umbrella coverage, she can do that. But make sure she agrees with you. The appropriate person to handle her questions is her agent.

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You have convinced me that one should NOT use an agent since their only responsibility is to sell insurance for the agency or insurance company and from all indications, has zero responsibility to the client to look out for their interests at all. Even after a 10 - 20 year “relationship” and a major life change such as selling a house and buying a condo the agent should just collect its paycheck and never even think about reviewing the policy for appropriateness.

Oh, I forgot, the agent can answer questions after the client figures out on their own what to ask. Seems to me a friend or relative can answer most any question with a little help from the internet. Or a call center. Oh, oh, the agent can also punch a few buttons to make any policy change which the client has figured out on their own is needed. Or could a call center do that just as well?

Sure some things may or may not be automatically added. Roadside assistance for an auto policy or mold coverage for a home or condo for example. Are you saying an additional $300 in coverage for additional structures could be automatically added as part of a condo “package” policy? In any case, it wasn’t “added”, it existed (appropriately) for the house. My aunt moved to a condo and “additional structures” is incongruous; here even a birdhouse is not allowed.

Ha Ha.:rolleyes: I can guarantee you that if I or my aunt called an “800” number and said to add a car the associate would inquire whether the old one was being kept.

No you did not answer my question. I know what an umbrella policy is.

I asked:

No thanks to any agent, I found that the coverage is the same for “common off premise liabilities” for both umbrella and home/condo liability. I have picked another company now because I am not comfortable with Progressive’s property insurance affiliate in Georgia. So instead of $100K condo liability coverage and an $1M umbrella, I plan on getting $1M in condo liability coverage. Either way not very expensive. But the end result is the same with the exception that an umbrella policy would cover libel, defamation, and other nefarious things I’m not worried about my aunt committing.

Obviously the agent has no fiduciary responsibility to the client (so no need for your “I am not” disclaimer). Now I also realize that it is uncommon to expect from an agent a moral responsibility or even an attempt to generate goodwill.

7

I’m sorry I failed to answer your questions to your satisfaction.

8

Different states have different rules for condos. In my state - maryland - there was actually quite a kerfufel a few years ago when our highest court ruled that [something I can’t remember - but it was along the lines of the Master Policy needed to cover everything that could impact someone else - otherwise everyone] - noting that other states didn’t do it that way. It sort of left companies scrambling as it still wasn’t clear what was covered. The legislature had to redo the law - and I was on the board for my condo when this happened. We had at least two lawyers and two insurance agents advising us - and one of the lawyers specialized in Condo law. It was pretty confusing - and while I know very little about real estate law - I’m pretty handy in other areas - including filing and winning a case Pro Se in front of the Court of Special Appeals.

Condo laws & Insurance policies are anything but clear. If you really believe you can gather everything there is to know about condo law off the Internet - then feel free. To me it seemed Sandra was only trying to help. Not all Agents are evil uncaring monsters (as you yourself seemed to point out).

Not to pick on you - or your understanding of the law, but you seem to equate condo with apartment (as in asking what Condo allows for building external structures - and you were pretty sure none).

Well in fact plenty do - as a Condo is NOT a type of dwelling - it is a form of ownership. In addition to apartment type buildings where they are normally used - you can have townhouse or single family homes as well. You can also have a condominium complex - with its own sort of rules and concern as part of a totally separate legal entity home owners association. This is common is planned communities with different builders and styles of homes. You have common areas within the condo - and a separate set of common areas that affect everyone else.

Regular real estate has tons of case law regarding insurance and such that goes back centuries. Condominiums didn’t even exist in many states I think until sometime in the 50s or 60s.

There isn’t a ton of case law on Condos (at least in some areas - such as mine).

I tend to agree with part of what I think you are saying - that an Agent should ask when you purchase a car whether you are getting rid of the old one. I wasn’t there - so I have no idea what occurred.

There are lots of advantages to umbrella insurance - mine covers lots of stuff in addition to the excess liability amounts. I admit some of it is rather obscure, but I like the fact that I get super posh treatment if my house burns down - and the idea of kidnapping and ransom insurance - hey why not? It was pretty cheap and gives me piece of mind. I can’t remember all the stuff - but I didn’t really look at it as excess liability - but that part isn’t bad either.

Anyway - I kind of am going off topic, but my point is that I’m pretty legally savvy - was on the board of the condo association for years - and spoke with the person who is kinda considered the king of Condo Law for my state - he himself said that basically there isn’t settled law on much of this - and some of it is guess work.

I am by no means confident in my knowledge of insurance policies related to condos. I tended to go overboard in making sure I was insured - as I wanted to make sure I was covered. I am more than happy to take the advice of any insurance agents in my state - and was selective in who I picked. I don’t have an agent for my regular non umbrella auto insurance.

So if you can figure all the stuff out on the internet that applies to your state - and know that your state hasn’t had a change in laws as mine has - and are confident that you know how a claim will be settled with whatever you plan on switching your Aunt to - then that is great.