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What to Look Out for in a Home Insurance?: An Interview with Dan Strack of Strack Insurance Services

By Dan Strack

Tell us a little bit about your company and its foundation.

Strack Insurance Services opened our agency in 1989 and until 2001 we worked as a captive agency for Allstate Insurance Company and The Prudential Insurance Company of America. In 2001 we changed to an Independent agency so that we could better serve our clientele. The early 1990's saw the push by the insurance companies to use credit scoring in their rating models. 20 years later about 99% of the carriers now use some form of this. Weather claims from Hail, Tornadoes, Hurricanes and water damage including mold damage and slab leaks continue to plague Texas and we pay some of the highest rates nationwide but the more companies that want to write your business the better your rates will be.

On the home insurance side of the business in Texas things were much simpler in the old days. For many years there was only one main Home insurance policy called an HOB which all companies sold and the only difference was the price and customer service provided. In the late 90's the Texas Department of Insurance relaxed its rules and allowed the companies to come out with their own policies. These policies were all different from each other with many different coverage's and requirements. To compare different policies side by side you can go to the Office of Public Insurance Council. In 2001 we decided we could better serve our clientele by offering multiple types of policies from multiple carriers now as an Independent Agency we offer Home insurance policies of all types, prices and requirements from over 20 different carriers.

What do I need to have in hand (documents, facts, bills, etc.) before I look for an insurance provider?

The Insurance companies look at 2 different categories to establish eligibility and price for a particular risk. First they evaluate the insurability of the owners and second of the home. Answers to some questions could create more questions. For an accurate quote all the info has to be correct.

A.personal info needed for named insured and spouse and occasionally a co borrower

1.names

2.dates of birth

3.social security numbers

4.addresses for last 3 years

5.current home owners need prior carrier and police #

6.claims filed by the insured at any address for any amount paid in the last 5 years

7.Will this be primary home, secondary home or rental property?

B. home info needed, some such as brick or frame, year built & square footage is available at most county appraisal districts or sites such as TexasHomesforSale.com. or Google earth.

1.complete address

2.age of roof and type of roof.

3.swimming pools?

a.fenced?

b.diving board or slide?

4.Pets?

a.# and breed

5.Trampoline or skateboard ramp?

6.# of bathrooms?

7.Fireplace and #?

8.5 year claim history of home

9.Security System?

a.monitored for fire?

b.monitored for theft?

10.on older homes or any home over 10 years old need to know when any updates to a.

Plumbing (even a water heater)?

b. Heating & AC? c. Electrical?

Will the location of my home affect my insurance costs?

The location of your home will directly affect your rates and eligibility. Some companies will not write homes outside city limits, on more than 5 acres or in counties close to the coast or in areas where they have had bad loss ratios. Each address in Texas is assigned a PPC or Property Protection Code. Your property code is the code assigned to the fire department that would respond to a fire at your home. The better equipped and trained a fire department is the better the rates are in the fire protection zone they cover. This code is on a scale of 1-10 with 1 being the best and 10 = no fire department or a very small and/or part time department. To get the benefit of this code you must have a fire hydrant within 1,000 feet of your property.

What does it mean to make sure I insure my home to "replacement value"?

Replacement cost is a continuously debated topic for the last 30 to 40 years. If you have a mortgage they usually require you to have a replacement cost policy on the property. It should not include the amount to purchase the land and has nothing to do with sales price or tax appraisals' but it should reflect accurately current building cost in your area.

The starting place is the worst case scenario. If your home is destroyed for any reason what does it cost to clear the lot and rebuild it as close as possible to exactly like what you had except brand new? Because there are so many variables in the scenario it is not an exact science and in return for this guarantee the state allows each company to determine their own replacement cost based on what they learn about your home in the application process and their knowledge of building cost in your area. This is why different carriers will give you quotes for different dwelling amounts.

For the protection of all the parties involved the Texas Department of Insurance has a Co- insurance clause that states you must carry at least 80% of what it actually takes to replace your home at the time of loss in order for your home to be replaced. In other words if it takes 100,000 to rebuild your home from the ground up and you only have a policy for 70,000, the state says you have agreed to co-insure your home and your carrier would only be responsible for 70% of the claim. This is unacceptable to most mortgage holders and most Insurance companies now require you to carry 100% of what they determine your replacement cost to be or they won't write it. If your home is paid for you can elect to carry an ACV (Actual Cash Value) policy which works just like an auto policy in Texas. You only get paid on the current depreciated value of your home.

Can I save money on my monthly premium if I add certain safety features to my home?

Safety features such as smoke detectors, fire extinguishers, dead bolt locks, alarm systems all can get you discounted premiums. Each company is different in what discounts they give and in what amount so check with your agent to see.

How can I ensure that I am working with a reliable home insurance provider?

Work with an established agent preferably one who has been in business more than 10 years, they are the ones who will still be around down the road at claim time when you need help. Check the AM Best financial ratings of the carrier and check on their complaint history with the Texas Department of Insurance. If at all possible deal with an Admitted Carrier which gives you added protections in the event an Insurer became insolvent.

What's the best way for people to get in contact with you and your company?

We are the home insurance experts in Texas and we work for you not the insurance company. We can be reached by phone 817-557-0100, toll free 1-877-557-0100, text 817-557-7783, email arlington@strackins.com, fax 817-557-1967 or our website Strack Insurance Services.

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About The Author

Dan Strack has been in the insurance business for 27 years and specializes in auto...

Phone: 1-877-557-0100

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