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am4tas

Member
What is the name of your state? TX
Every other company I have dealt with asks me to apply, approves,
quotes, then inspects. I would prefer not to pay a whole lot just to
find out I have been given a low-ball quote, or even that there is some
requirement to provide sensitive personal data on some insecure
portal while indemnifying them for doing it...all this while I let my old insurance lapse. Is this a suspicious
practice? More standard these days? Why can't I at least see the application first?
 

adjusterjack

Senior Member
Might be standard practice online. If you don't like it, don't use it. Find yourself a local independent agent or direct writer whose office you can walk into.

When you fill out and sign an application, insist on getting a copy and taking it with you for your files so you can compare it to the policy when you get it.

Lapsing your insurance was foolish. That's not only an underwriting no-no but if you have a mortgage your mortgage company will put coverage on the property and charge an outrageous amount to your account. That insurance will only protect the mortgage company's interests and will do nothing for you.
 

am4tas

Member
Thank-you for that. The State insurance help line had never heard of this practice.
I can't imagine why anyone would ever pay up front just to find out if what they paid
is right. Obviously they quoted without a credit check, although they ran a CLUE report.
One has to wonder why I ask "can I SEE the application before paying" and get no response.
My insurance has not lapsed, but it would as they might not even inspect for 30 days after
the application, and the quote says "paying does not bind coverage".
 

adjusterjack

Senior Member
The State insurance help line had never heard of this practice.
Meaningless. As long as it's not prohibited by insurance law, it's legal. You don't have to go along with it.

By the way, when you apply on line you ARE filling out an application. You can take a screen shot of each web page and save it to your computer so you have a complete copy. You do it with Snipping Tool, feature in PCs since Windows Vista and up to Windows 10. I think Macs have something similar.
 

ALawyer

Senior Member
It almost seems as if you are dealing with an insurance agent rather than an insurance company, and the agent or his/her agency is either somewhat unscrupulous or wants to make sure you have the money to pay for the insurance should it find a carrier willing to accept you. Also, as you suspected, if it finds you a carrier at a higher price it would have a leg up as you had already paid them something so getting them the additional amount would seem smaller that paying the higher amount a new carrier might want, and it would be less inconvenient for you as otherwise you'd have to wait for them to refund the money and in the meanwhile pay a new carrier or agent.
 

am4tas

Member
Good point all, thank-you. I AM dealing with an independent broker. So I went to the insurance company's website and made
a general inquiry on one of their forms. It went like this:

"May I see an application for homeowners insurance prior to purchase?"

Here is the response I received:

"Thank you for your email. The agent will provide you a quote prior to purchasing the policy. If you can provide me with the name of the city and state you are in, I can give you a list of agents in your area that can give you a quote. If you have any additional questions, please feel free to give us a call."

This answers something but not what I asked, and it was that simple. I can't even view the application. I asked the broker and he referred me to the company. Perhaps it contains some completely unacceptable term than makes what I already paid a problem(?) Without something in writing via regular mail to define what the refund policy is this seems like the traditional pig in a poke.
 

adjusterjack

Senior Member
I AM dealing with an independent broker
Does that mean you went to the broker's office, sat down at his desk, answered questions, while he entered all the information into his computer (or wrote it down on paper). That was the process of filling out an application and you could have asked for a print-out of it.

I already paid
You paid without asking for, or getting, a copy of the application.

Should have insisted on it before you paid.

If you want to know the type of information that was relayed to the insurance company read the following ACORD Homeowners Application.

http://www.hpiainfo.com/wp-content/uploads/2015/10/Acord-80-201309-Homeowner-Application.pdf
It's a standard form used by much of the insurance industry and when that exact form is not used, all or most of the information on it is asked of the applicant.

Print it out. Fill it out with all the information you remember giving to the broker and keep the application in your own files until you get the policy.
 

am4tas

Member
Thank-you for the great PDF...it was quite educational. When I said "Perhaps it contains some completely unacceptable term than makes what I already paid a problem(?)" that was meant to be theoretical---like "why would I ever pay for something without reviewing its merits?" I should have been more clear by inserting "makes what I MIGHT HAVE already paid". The broker is 100M+ away and we are dealing
over the internet. We have never met. He wrote me:

1)I pay him using CC based on his quote that stipulates "paying doesn't bind coverage".
2)THEN the company somehow gets an application to me. No one will tell me how or by what media. I asked to see
the application. He referred me to the company.
3)I double-checked with the company and they restated this method.
4)If approved someone inspects within 30 days.

I am at a stage where I have
paid nothing because they won't even cough up a PDF like you just showed me. What would be the harm? I
was speculating there might be some objectionable terms as a reason for the secrecy. The State insurance hotline
people are similarly curious. They said if I decide to pursue this tell THEM what happens.

They have my interest because they have a very LOW quote for very high coverage. Perhaps the required process
would result in their bringing their number up more on a par with other quotes I am getting. My big question is
"why the money first"? My FICO has been over 800 for a decade. There has never been a mortgage on the house. They can figure out I can pay.
Maybe THAT'S it.
 

adjusterjack

Senior Member
The broker is 100M+ away and we are dealing
over the internet. We have never met.
That's probably a big part of the problem. Answer the following questions:

1 - Where do you live (city)?
2 - Where is the house located (city)?
3 - What date does the current policy on the house expire? Or has it expired already? What's the name of the insurance company on the house now?
4 - What's the name of the insurance company that the broker wants to place you with?
5 - Why are you changing insurance companies and agents?
6 - How much coverage (dollar amount) are you asking for on the house and how much was the quote for?
7 - How old is the house?
8 - Condition of the house?
9 - Who lives in the house?

Answer all those one by one and I may be able to figure out what's happening and advise you better.
My big question is
"why the money first"?
Pretty much the same reason that you don't walk into a grocery store and walk out with a loaf of bread without handing over money first.

There is nothing strange about an agent being required to get the money first before the insurance company will issue the policy. That's pretty common, especially if the agent doesn't know you.

Many insurance agents have binding authority for some of their companies where they can bind the policy when they receive the money. But there are insurance companies (I used to work for one) that didn't allow that and wouldn't make the insurance effective until the money was received at the company level.

When you have an established relationship with an insurance company or agent you might be able to get a policy issued and get sent a bill.

There's nothing wrong with having to pay for the policy up front.

What bothers me is this application business. There's no reason an agent shouldn't be able to email you an application either before or after you get a quote, whether it's for you to fill out or one he's already filled out.

Bottom line, though, if you don't like the way this broker does business there are tons of insurance agents and brokers that would like to do business with you.
 

am4tas

Member
One point of fact not mentioned was that this broker sent me sample PDF
of the policy he would be selling early in this process (at my request), but
failed to mention that the application would become part of it. The policy was fine.
I cannot be completely specific because some of my reasons
are sensitive in nature and require my discretion (hope this is enough for you):

1 - Where do you live (city)?
None. Rural Texas north of Corpus Christi one county inland (out of direct hurricane zone).

2 - Where is the house located (city)?
Same place...although due to all the mailboxes around here being run over by teenagers in pickups
my mailing address has always been a service in town. The agent confirmed all this through the
public online appraisal district. I am guessing a separate mailing address gets people upset. I've had
3 mailing addresses in 48 years.

3 - What date does the current policy on the house expire? Or has it expired already? What's the name of the insurance company on the house now?
End of this month. Small local Texas mutual. They never asked this, never checked my credit, but
managed to run a CLUE report (so they know).

4 - What's the name of the insurance company that the broker wants to place you with?
Good question, I'm dying to tell you. They specialize in writing hurricane zone policies
in places like FLA and TX. I have discovered at least 5 agents local I have received OTHER
quotes from (with more standard stock companies) who represent this company as well.
This guy responded fast over the internet and quoted this company only. The State insurance
hotline had a hard time even finding them in their database.

5 - Why are you changing insurance companies and agents?
Don't get me started...but let me list one thing that would have been enough. I live on acreage that is
completely secured. Female members of the family use our rather elaborate pool complex with the
expectation of privacy. The company inspects/photographs my premises unannounced and uninvited.
Not even the assessor comes around here like this. In these parts it is a hazard. The "result" of this
intrusion was to raise my premium midway through a period I had prepaid for a year, and charge partial
payment fees. The rational was they "missed" a small improvement that has been here for decades.

6 - How much coverage (dollar amount) are you asking for on the house?
$300K...less than value...highest deductibles...I assume all other risk.

7 - How old is the house?
1980's.

8 - Condition of the house?
Pretty much perfect.

9 - Who lives in the house?
Small single family.
 

adjusterjack

Senior Member
One point of fact not mentioned was that this broker sent me sample PDF
of the policy he would be selling early in this process (at my request), but
failed to mention that the application would become part of it.
Well, all insurance does that. Perhaps not stapled to the issued policy but is part of the underwriting file.

The policy was fine.
Probably an HO-3 like you already have but with proprietary endorsements that limit certain coverages.

What's the name of the insurance company that the broker wants to place you with?
Good question, I'm dying to tell you. They specialize in writing hurricane zone policies
in places like FLA and TX. I have discovered at least 5 agents local I have received OTHER
quotes from (with more standard stock companies) who represent this company as well.
This guy responded fast over the internet and quoted this company only. The State insurance
hotline had a hard time even finding them in their database.
This site has a thing about naming names but I was a claim rep for many years for an insurance company just like that. Might even be that one. It specialized in insuring high risk properties in the gulf states and used the application process that you described. Agent gets the money, remits to the company, the company reviews the risk, inspects at its option, and decides whether or not to offer a policy. Several years ago my former company became a subsidiary of a major national insurance company (Life Comes at You Fast) and changed its name to conform to the parent company. Might explain why your Ins Dept couldn't find it.

Frankly, if your property qualifies for a standard carrier you should probably walk away from the high risk carrier.

The company inspects/photographs my premises unannounced and uninvited.
All insurance companies do that. Most people don't even realize it's happening because the inspection doesn't change anything for which the insured has to be notified. If you don't have any major grievances with that insurance company (other than that) you should probably allow your policy to renew.

Understand that any new insurance company that you go with has 60 days to cancel for any underwriting reason. That's why many standard insurance companies issue first and then inspect. They can relieve themselves of the risk if they find anything questionable within the first 60 days.

6 - How much coverage (dollar amount) are you asking for on the house?
$300K...less than value...highest deductibles...I assume all other risk.
Replacement cost and market value are two different things. If you don't insure to a certain percentage of the Replacement Cost you certainly are assuming a good part of the risk. You can read about it in your policy. It's a standard provision from company to company so you'll find it in your current policy and probably in the sample you got.
 

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