This is way more detail than you need, but this homeowners pricing actuary lays it all out.
The answer is basically “everything”, but more specifically:
Homeowners insurance typically does not cover earthquake damage, so keep that in mind.
I think the exclusion is ordinarily more broadly defined like ‘earth movement.’ It comes up in places not prone to 'quakes for problems like sinkholes, landslides, but also human caused movements like your neighbor’s basement excavation.
Fracking? We’ll see.
I live in an area with low insurance costs (home, auto, etc). Our house insurance is $894 a year with about $500K covered for the dwelling.
Yes, exactly. As the people in Palos Verdes have learned the very, very hard way.
This is not the deciding factor in the OP’s quote, but I bring it up since you mentioned the monthly payment. Carriers typically give discounts for annual (and sometimes semiannual) payment plans versus monthly. You might see a 5-10% drop on the rate.
The real problem, as explained by others above is state regulators limiting the rate of increase to below-legit numbers. Basically challenging the insurers to a game of chicken: “Either accept below market premuims or lose 100% of your customers in our state. Do ya feel lucky this year? Well … do ya?” Lather rinse repeat for enough years and even the most next-quarter-bonus focussed CEO recognizes that pretending this is sound business is not foolish, but foolhardy.
Many insurers have departed the FL hurricane coverage market and now the FL general risk market precisely for this reason: the state government doesn’t want to upset the real estate bubble economy apple cart.
(Really asking)
How is this not upsetting the real estate bubble economy apple cart?
When I got a mortgage for my place having insurance was a requirement to get the loan. I could buy from anyone I wanted as long as it met some minimum requirements to adequately cover the place.
If I want to buy property in Florida and no one will insure me how do I get a loan?
Alternatively, I can get a loan but at an insurance price so outrageous it makes buying the property impossible.
I can’t imagine lenders being keen on loaning hundreds of thousands of dollars for a house where they will lose it all with one bad storm that aren’t exactly uncommon.
Seems a great way to overturn the cart.
ETA: Maybe if the next few hurricanes bulldoze enough property speculators can swoop in and buy up cheap property.
I’d not ever had an issue with any questions about my roof until this year; my homeowner’s insurance company was initially unwilling to renew my policy, until (a) I had a tree near the house cut down, and (b) I provided proof of the age of the roof (which had not ever been asked before).
They did renew us, but the roof is about 12 years old, and it’s the older three-tab asphalt shingle type. I have my insurance through an independent agent, and they shopped for me with every insurer they offer: no other insurer would even touch me, because (a) the roof is more than ten years old, and (b) it’s three-tab shingles (they now prefer architectural shingles).
And, in reply to the OP: even staying with the same insurance for the past five or so years, my homeowner’s insurance premium has more than doubled in that time.
I was doing a little comparison shopping on homeowners insurance, and they wanted proof of our new roof. (never asked that before either). I don’t even know how I’d do that. Even though the roof is only two years old Maybe ask the roofers? I don’t keep paid invoices, or at least not in a place I can find them.
Mine is about double that.
Let me let you in on a little secret. Insurance companies hate to pay out on claims. So, many are pulling out of CA and Fla, and a few other states.
In case anyone else wondered, I Googled, and the difference between three-tab shingles and architectural shingles is that the architectural ones are about fifty percent more substantial.
That’s consistent with what I was told, as well: that they are less likely than the old three-tab design to be damaged in a storm.
We have concrete shingles, totally wind and fireproof. It doesnt matter.
What do the insurance companies think about metal roofs? Or those half round clay ones?
They like them, but in Florida and CA it is almost impossible to get insurance at any price. We have to get our fire insurance thru the State. No company will cover us.
Certain records probably ought to become an exception to that policy.
Proof of your basis in any/everything you own that’s unusually valuable. Any/all home improvements and major repairs. etc. In terms of total volume of paper it’s a drop in the bucket compared to every cash register tape or online purchase you make every year. But keeping those ~dozen hunks of paper per year in a single identifiable filing place until superceded is a great idea.
Same thing with receipts for car tires and batteries. You only need the latest one, so that’s 2 pieces of paper per car. Changed out every 3 to 6 years.
That won’t help you recover past invoices you’ve already trashed, but the sooner you start, the sooner you’ve got a useful history built up.
I agree. I need to get organized. I have in my email in box all my invoices for a recent major remodel. It wouldn’t take much to put them in a file on my computer and print them out. It’s on my to do list. Maybe I can find the roofer’s invoice. But I wasn’t going to raise my stress level just to shop insurance, when I have a policy that’s been in place for over 20 years and they’re not asking for anything.
I don’t think repairs affect the basis - I might keep receipts for a repair for as long as there is a warranty but there is no reason for me to still have the invoice from the plumbing or roof repair I had done 20 years ago.
The thing about repairs is two-fold.
One, big expensive repairs tend to have big expensive failures. Lacking a receipt you have little recourse to the original contractor.
Number two, the definition of “repair” versus “improvement” in the IRS regs is as elastic as you or your CPA are brave. As you rightly say, repairs don’t affect basis. Improvements do. It is a rare significant repair that is 100% like for like.
Somebody comes out to plunge a clogged toilet? All repair; no improvement. You replace a contractor grade POS 1975 toilet with a 2024 low water use Toto? And replace the rusting failing cast-iron soil line & flange with new ABS? A big fraction of the total bill is improvement and can be used to offset basis.
Those are the use cases I’m thinking of.