I heard today that Nationwide is cancelling insureds policies, and is in the process of letting staff go in parts of Texas. I also heard central is not writing new policies, but is only honoring existing policies.

I thought they were both good carries, and sad to see them go. Any other carriers leaving Texas?

Kemper left, Progressive largely shut down homes on the Independent Agent side, Safeco declines about 60% of quotes they get, Travelers is close to shutting down, and many others have greatly restricted what they will accept based on location, age of home, age of roof and coverage amount.

How long before each state has its own insurance company?

lobopride said:

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How long before each state has its own insurance company?

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Like the Texas FAIR Plan?

Martin Q. Blank said:

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lobopride said:

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How long before each state has its own insurance company?

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Like the Texas FAIR Plan?

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I didn't know that was a thing.

Bought a house in May. I'm covered by Texas FAIR Plan bc I was denied by numerous other providers bc my roof is 12 years old.

lobopride said:

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Martin Q. Blank said:

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lobopride said:

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How long before each state has its own insurance company?

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Like the Texas FAIR Plan?

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I didn't know that was a thing.

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read their reviews, it's pretty much a non option for me

Texas Farm Bureau told one of my clients yesterday that they will no longer insure roofs over 10 years old. That's a new one for me.

If returned, lenders would prefer their collateral has a roof on it

Insurance companies will exclude coverage on a roof.

Mine is excluded on my policy. (It's 80 years old and metal)

BiggiesLX said:

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Why not just offer a plan that doesn't include the roof? Some shingles are good for 30 years so I don't see how 10 years makes sense.

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just get a 5 or a 10% deductible

Earth Rider said:

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I heard today that Nationwide is cancelling insureds policies, and is in the process of letting staff go in parts of Texas. I also heard central is not writing new policies, but is only honoring existing policies.

I thought they were both good carries, and sad to see them go. Any other carriers leaving Texas?

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This has been happening since 2022. They are pulling out of coastal areas. They stopped issuing new commercial policies then (and maybe SF, I dont know). If they are cancelling SF now, its more proof. They got burned BAD by the last couple of years.

I put on a metal roofing product about 5 years ago and increased my deductible. Hoping the investment was worth it.

Diggity said:

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If returned, lenders would prefer their collateral has a roof on it

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When most of the market can't get coverage, putting them in default, will the lenders all take back their collateral? Thereby devaluing it. Sounds like a housing crash that'd make 2008 blush beet red.

Seems like the legislature might have to do something to help make the market more insurance friendly than it is.

The Collective said:

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I put on a metal roofing product about 5 years ago and increased my deductible. Hoping the investment was worth it.

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It is worth it. My metal roof has been through 4 hail storms. Got a dent or two after the last one but it won't be a problem. If insurance gets too high and I have to exclude the roof then I will. I'll pay for that out of pocket if needed. It's the way to go if you can swing the cost and you are going to live somewhere long term.

normaleagle05 said:

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Diggity said:

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If returned, lenders would prefer their collateral has a roof on it

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When most of the market can't get coverage, putting them in default, will the lenders all take back their collateral? Thereby devaluing it. Sounds like a housing crash that'd make 2008 blush beet red.

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not disagreeing with you. just offering my thoughts on why not covering the roof might be impractical for many people.

The Collective said:

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Seems like the legislature might have to do something to help make the market more insurance friendly than it is.

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It's a complicated problem the legislature can't fix. My dad sits on the board for a smaller homeowners insurance company here. On average, their claims run about $60MM/year, and that's been pretty consistent for the past several years. Last year, they had $260MM in claims. Insurance companies have policies that protect them for catastrophic events like hurricanes, large tornadoes, etc., but those policies only get triggered when they have claims from an individual event over a certain amount. Last year, they all got hit with a bunch of individual events that didn't trigger those policies, so they're on the hook for all of it. Throw in cost increases due to inflation, and you get into situations where the current premiums and returns on investments don't come close to covering the claims. So homeowners are going to have to have more skin in the game going forward for roofs.

I don't think we disagree at all.

There looks to be an upcoming catch 22 where the lenders and owners have agreed that the owners will buy something the market is going to refuse to sell.

That'd be an unfortunate situation for most.

BiggiesLX said:

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Why not just offer a plan that doesn't include the roof? Some shingles are good for 30 years so I don't see how 10 years makes sense.

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I'm wondering why they don't offer policies with a separate deductible for the roof. Like 50% of the cost, or something like that.

We are going to need a program much more robust than the FAIR plan. Back in the 90's the state created a worker's comp insurance company called TWCIF that competed directly with other insurance carriers are the retail level. It helped save the industry. At one point it had 50% of the market.

The state also dramatically changed many of the work comp problems so that definitely helped too.

Just lost my auto insurance (Esurance) because of them leaving our state. Shopped around and picked up GEICO.

They do. It's called wind/hail and it may very well be more than 50% depending on the percentage, value of the dwelling, and depreciation.

In theory, that's what insurance companies tried to do with the wind/hail deductible, but it obviously hasn't worked out for them in a lot of areas.

I have 2% for wind and hail, which is "standard" in my area.

I just got a new roof. My 2% deductible is $8k.

Adjuster came out and wrote up a report approving $20k for a new roof, plus my $8k deductible. That's $28k total.

I had already decided to use a roofer recommended to me by others who were satisfied with the work.

Under the current insurance claim model, homeowners have no idea what the "fair price" of a new roof should be, nor do they have any incentive to shop around and find a better price. It's all based on what the adjuster says insurance is willing to pay. And as soon as a roofer sees the claims report, the dollar value on the report is going to be what the roof costs.

In my case, I'm out $8k no matter what the total cost is.

Insurance company sent me both checks before the work on the roof had even started.

If the homeowner were on the hook for a larger percentage of the cost of a roof, they would have skin in the game. Maybe people wouldn't be putting in roof claims as often and pricing would become more consistent and transparent.

The other part of this issue is insurance companies not wanting to insure roofs that are over 10 years old, either through dropping customers or jacking up their rates. This is nuts, but if the overall number and/or cost of roof claims goes down, it might relieve this problem.

Insurance companies created this problem, and they need to fix it (in a way that doesn't screw homeowners).

As a side note, my parents' deductible in MS (where Katrina hit) is $30k on a very modest house - roughly a 10-12% deductible. That's not by choice - it's the best policy they can get.

Basically, insurance isn't paying for new roofs there (which is what happens when you raise the deductible too high). So, technically homeowners may be insured, but in reality, how many homeowners can cough up the full price of a new roof? At that point, the policy isn't worth the paper it's written on, at least from the perspective of a mortgage company trying to protect their asset.