Propaganda
It’s no mystery…
Big businesses lobby in this country, and the insurance industry is one of the biggest. Insurance companies routinely spend more than $130 million annually to lobby, and more than $70 million annually in campaign contributions to influence politics, politicians, and legislation in their favor, and that’s just what we know about.
Before you ever make a claim, the deck is being stacked against you and it’s been stacked against you, for years.
As part of that strategy, insurance companies also rely on news articles and favorable reporting on issues that are often misrepresented to the public.
Let’s look at an example in the Miami Herald, before hurricane Irma.
South Florida’s leaky pipe problem poses risk to homeowners insurance
A brief introduction referencing the decade without a hurricane, followed by the presentation of a new boogey man. LEAKY PIPES! YOUR PREMIUMS ARE GOING TO SKYROCKET! CONTRACTORS ARE CHARGING TOO MUCH!
Don’t get me wrong, YOU should always remain in charge of your claim, and the contractor issue does need to be dealt with, BUT the main point of this article is that as homes age (or construction booms for new homes results in subpar workmanship), there are a LOT of pipes leaking.
Prior to Irma, plumbing claims were easily more than 50% of claims.
This is a job for underwriting though. If this were actually the problem, a better investment in underwriting and actuaries would solve this problem. But instead, for years, insurance companies in Florida have been fighting plumbing claims head on attempting to continually increase record profits. In addition to that, behind the scenes, they’ve been slipping in policy changes that work against you, before you even have a claim.
Plumbing leaks completely excluded from coverage? We’ve seen it.
$10,000 cap on plumbing claims? We’ve seen it.
$3,000 cap on emergency repairs to protect the property? We’ve seen it.
Complete exclusion on emergency repairs? We’ve seen that too.
The kicker is that these policies are often being sold with a negligible premium discount. For example, on one of our own homes, we got a quote from an insurance agent for a policy that completely excluded plumbing claims, and it only resulted in a $40 premium discount FOR THE YEAR! That’s a difference of $3.33 a month, for the most common type of insurance claim.
If plumbing problems were truly that much of a burden, would the premium difference really be $3.33 a month?
I don’t think so. That smells of a trick to trap the people just looking for insurance at the lowest price.
The lesson here?
Stay vigilant, educate yourself, and seek representation.
To help with that education, we’re working on compiling a bunch of information, both to let you know about our services, and to give you insight into what you’re up against. Feel free to check out our pages on: