The question of the day from one of my clients was
Why is homeowners insurance so expensive in Mckinney Texas? I just moved form Frisco and was with State Farm.. and when I moved to Mckinney it was more expensive than Frisco Tx! Why is that? Why would State Farm charge me more to live in Mckinney than Frisco for Homeowners Insurance???
So I proceeded to give him my geeky insurance guy answer...
I will save you the long winded boring answer.. but here are the highlights.
All insurance companies have various rules they use to develop pricing. Whether you are with State Farm.. Allstate.. Farmers.. Travelers.. Safeco.. Hartford.. they use the same 3 basic rules.
1. Location, Location , Location..
Each city has a different rating as far as fire prevention goes. The technical term for this is called protection class. The city earns a rating from 1 (best) to 10 (worst) based on a bunch of different factors.. how many fire hydrants per household. Number and distance of the fire stations in the city. Whether the city has a volunteer fire department.. etc.. etc.. Frisco is currently rated a class 1 . Mckinney is rated a protection class 2. (second class)
The insurance companies give a bigger discount for protection class 1 then protection class 2. So all things being equal.. homeowners insurance in Frisco will be cheaper than home insurance in Mckinney
2. Old homes are more expensive.
Most insurance companies in Texas give a large discount on home insurance for newer homes. For example if you went to insure a home built in Frisco Texas that was built in 2011 vs the price to buy homeowners insurance in Mckinney Texas built in 1981 there would be about a 25% difference in the price of the homes. It would be cheaper to insure the home in Frisco then Mckinney due to the age of the home. Age of the home is one of the biggest drivers in determingin price in home insurance in Texas
3. Prior Claims are expensive.
All insurance companies look at your claims history when determining your home insurance prices in Texas. The more claims you have.. the more expensive your current policy will be. This is the same for home insurance in Texas, with State Farm, in Mckinney or Austin.. or with Allstate.. it doesnt matter.
So before you file that $1000 dollar claim.. think twice. Its stays on your record for an average of FIVE years. Yup FIVE.
If you happen to be in the market for home insurance or car insurance in Mckinney, Frisco , Allen or Plano .. give us a call or visit our website.
minsuranceagent.com
Mauceri Bynum Insurance
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