Home-owners Insurance Co Wants to Survey House...After 12 years

November 18, 2013 8:23 AM

I've had a home-owners policy with the same insurance company since purchasing my house in 2002. Last week, I had a message on my answering machine from a man identifying himself as an auditor with a 2nd party surveying firm. He said he was calling at the request of my insurance company to set up a date/time for a survey of my house.

After he called back I tried to ask him what the nature of the survey was (eg safety, assessment, audit, valuation) and how the information would be used. I thought it safe to assume the purpose was ultimately to find a reason to raise my premiums. He gave me some vague answers about updating insurance company files and suggested I call my independent insurance agent for more details. The agent was equally unhelpful, so I'm left to understand this is being done for REASONS. For what it's worth, I feel sure this surveyor is actually who he says he is and that my insurance company did indeed solicit his services.

My first instinct is to deny the guy access to my house and start the PITA of getting all my insurance needs re-quoted by competitors. I've never had an incident or accident at my home nor have made any claims. In that time, there have been no claims on my automobile insurance for that either.

The lack of a paper trail or any documentation makes me suspect some of the parties here are operating on shakey legal grounds. So is this weird or a normal thing? Has anyone ever heard of this practice? Are any of the parties here doing, or coming close to doing, something illegal? I've only found one, somewhat breathless report of this on the internet.

posted by klarck to Law & Government (22 answers total)

My dad just had this happen in CA, but they were mostly surveying the fire danger (due to proximity to flammable hills). Sadly his insurance went up double digit percentages.
posted by cecic at 8:35 AM on November 18, 2013

Wait, he wants to come into the house? Or just survey the property? No way in hell anyone's coming into the house, and I'd be wondering what they'd want with an updated survey of the property.

I've had homeowners insurance for close to 20 years and the only visit I've ever gotten was when I filed a claim for hail damage. My cynical guess is that this is a prelude to either a premium hike or a cancellation, but that's just my usual sunny outlook.

Any chance you're in a newly discovered flood plain or anything along those lines?
posted by jquinby at 8:35 AM on November 18, 2013

Anecdatally, I've had the same call and AFAIK the survey was done (it's a rental property) and my premiums did not change afterward.
posted by rabbitrabbit at 8:36 AM on November 18, 2013

suggested I call my independent insurance agent for more details. The agent was equally unhelpful, so I'm left to understand this is being done for REASONS.

Just to be super double checking sure, you called the number you already had on file for your insurance agent, right? And not a number that this unsolicited caller gave you?
posted by elizardbits at 8:43 AM on November 18, 2013 [4 favorites]

I don't know about this particular practice BUT I'm just chiming in to say that my homeowner's company unilaterally canceled my coverage based on a drive-by assessment of my roof (i.e. from the street, one of their guys decided it looked old.) It was ultimately a trivial matter to get new insurance, but it was a stressful day until I did. Just be prepared for that.
posted by fingersandtoes at 8:43 AM on November 18, 2013

A few years ago a neighbor's insurer had a look at the exterior of their house and bugged them about removing a dangerous tree branch hanging far out over the roof. That inspection didn't require permission or any special access, as the house was about 20' from the sidewalk.

Asking for access to the inside of the house, if that's what's happening here, sounds analogous to my car insurer wanting to install a monitor on my car so they can track my driving habits, with the promise of a discount if they can watch me as I drive safely, and the unstated obvious consequence of higher premiums if they see me driving in ways they regard as dangerous. I have so far been completely unwilling to allow them to do this.
posted by jon1270 at 8:46 AM on November 18, 2013 [1 favorite]

Datapoint: My folks' cabin had a similar assessment. The assessment lady did a walkthrough of the property and the interior... Took about 20 minutes, but it was a bit of a pain to schedule as the cabin is pretty remote. This is in a fire-prone area, and insurance rates are rising across the state due to major wildfire activity the past few years.
posted by mochapickle at 8:49 AM on November 18, 2013

This is a normal thing, I'm pretty sure. We got a similar notice that our house would be surveyed on such and such a date after we'd lived in our place for about ten years -- I don't think they needed to come inside, but a guy did come to wander around on the lawn for a bit and take photos. Our rates didn't change.

I think it's pretty reasonable for an insurance company to check every decade or so to make sure that the thing they're insuring is being maintained properly and hasn't sprouted a rickety homeowner-built deck or etc.
posted by ook at 8:49 AM on November 18, 2013 [1 favorite]

Response by poster: - - - I used the phone number I had on file to contact my insurance agent. No man-in-the-middle vector here.

- - - No rezoning or flood plain changes. No nearby fires, trees downed or accidents. No neighbors with similar survey requests.

- - - Surveyor wants access to inside of house (basement and all rooms) to determine measurements, type of wiring, type of plumbing and any "obvious safety issues" to "update the files" and make sure I'm "not over or under-insured." Not certain what his qualifications are.
posted by klarck at 8:59 AM on November 18, 2013

I spent a summer telemarketing for a major insurance company. My job was to call customers and "double-check the information in our files". In reality my job was to look for discrepancies in what the policyholder stated during the application and what the policyholder said during the call (e.g. said they drove the car only on weekends, but found out they drove the car daily to work).

So I take the phrase "update the files" to mean "we're trying to figure out how to raise your premium". Why would the type of wiring in your home change in the past 12 years?

I'd tell the surveyor to bug off and start getting new quotes.
posted by JoeZydeco at 9:09 AM on November 18, 2013 [3 favorites]

Have you done any improvement to the property? Like, added a utility barn or anything?

Insurance companies have started utilizing Google Earth to spy on homeowner properties (mine used GE a couple of years ago to measure how far my home was from the nearest fire hydrant. My rates went up because of this) Perhaps they noted some property improvement on GE and they want to have someone come out and see how major the improvement is, and adjust your rates accordingly.
posted by Thorzdad at 9:29 AM on November 18, 2013

Insurance companies have started utilizing Google Earth to spy on homeowner properties (mine used GE a couple of years ago to measure how far my home was from the nearest fire hydrant. My rates went up because of this)

Insurance companies and governmental taxing structures have been doing this for decades with aerial photographs. It's just a lot easier (and quicker!) now with digital satellite imaging.
posted by JoeZydeco at 9:41 AM on November 18, 2013

there are also dignity and self-respect issues in play. it was disrespectful for your insurance company to sic a total stranger 3rd party company on you and expect you to allow a stranger into your home. i don't roll that way...

-i don't feel a need to explain or justify my funky decor.
-it's nobody's business what's in the gun cabinet, and above all...
-i don't want my interior cased for valuables.

if your insurance agent wants a look inside, s/he owes it to you to explain why, and exactly what they're looking for. is there a checklist, or is this a general fishing expedition? i get to see the checklist first. my vendors will exhibit a punctilio of respect to me at all times, or i will "go negative" on them.
posted by bruce at 9:51 AM on November 18, 2013 [1 favorite]

I'd both start getting new quotes and allow my current insurer in to review. I would ask that my agent be present, along with me, while the 3rd party is doing the inspection.

We just ditched our house (and I could not be more pleased) but our neighbor's 40ft pine tree fell over into our backyard, taking out the fence in two sections. Turns out his tree had Pine Bark Beetle. He had the second tree removed before it had a chance to take out the house.

It seems prudent for the insurance company to verify that your contents are what you say they are, and that there haven't been any changes to the property that would reduce its value.

I'd meet them half-way, but I'd also be gathering new quotes, because this could be a prelude to a rate increase, and if so, I'd want options. If not, I'm not going to cut off my nose to spite my face either.
posted by Ruthless Bunny at 10:01 AM on November 18, 2013

What an excellent opportunity to shop around for another insurance company! Since other companies are going to want to walk through or see the property, anyway. I suspect that the insurance company is just trying to be careful about coverage. They probably know better than you (or me) what the real trouble areas are and what ends up costing big money to deal with.

This actually sounds normal to me. I own a house that I rent out. I stop by to check it out once a year to make sure that it is being taken care of and also to make sure the tenants aren't living with a problem that I should actually deal with but they they haven't bothered to comment on. Insurance agencies probably feel the same way, but with a longer time frame.
posted by BearClaw6 at 10:55 AM on November 18, 2013

I recently had such an inspection. My insurance company, to their credit, sent me physical mail weeks before the inspection was scheduled to let me know exactly what was up.

The inspector spent less than 5 minutes inside my home and maybe 5 more walking around the outside. As it was explained to me, this was to ensure that this was to ensure I had adequate coverage for the house. My premiums haven't gone up, but I'm in the middle of a 6-month cycle, so there's still time.
posted by adamrice at 11:10 AM on November 18, 2013

Your insurer has to know what they're insuring, and if you haven't ever given them an update, they probably figure that in 12 years, something has changed. I called our insurance last year to tell them we had a change, and they emailed me a form that I was supposed to fill out with all kinds of questions that I don't know the answers to. What do I put under "Doors and millwork"? Yes? A number? A picture? I never did send it back (they wanted me to fax it, for heaven's sake) and our rates went up anyway. I wish they had just sent a dude.
posted by sageleaf at 12:08 PM on November 18, 2013

The lack of a paper trail or any documentation makes me suspect some of the parties here are operating on shakey legal grounds.

Doesn't sound that way to me. Insurance companies are generally allowed to inspect the properties they insure, and they're allowed to use third-party inspectors to do it. They don't do it very often, but I think you'll find that the terms of the policy permit them to do so.

One reason for this is that in most cases, companies insure houses without ever actually laying eyes on them. They just trust that their agents are taking accurate information from insureds and that insureds are providing accurate information to agents. This is true most of the time, but there are errors--and fraudulent misrepresentations!--often enough that some random spot checking is in the carriers' interests. Inspecting every home before issuing a policy wouldn't be cost-effective, but inspecting 5% or so over the course of a decade is probably worth it. We're talking about things like listing the wrong construction methods, square footage errors, construction quality discrepencies, etc. It happens.

One other thing: real estate prices across the country have been on a real rollercoaster ride for the past five years or so. Insurance companies don't insure based upon market prices, but upon the cost to repair. So, for instance, it's possible that a home which was purchased for $500,000 and cost $350,000 to build is now only selling for $300,000 with $400,000 outstanding on the mortgage. That puts everybody in a weird place. Insurance companies can and do pay out more than a house could ever sell for, but they don't really like doing it, and they occasionally run inspections to make sure that they're not writing more coverage than they actually want to write.

All of which to say that this doesn't necessarily raise any red flags for me. But if you don't want to deal with it, feel free to switch carriers.
posted by valkyryn at 1:56 PM on November 18, 2013

This is not uncommon. I have encounter this frequently, both as a property owner and as an electrical contractor making repairs.

The guy is a licensed building inspector, no doubt, because the bank wants someone official. But, really, he is looking a handful of things, and any obvious issues. In fact, it is very likely that the your house was targeted for some reason, ie. he is really looking for one specific thing in your house.

If he finds anything, you will have a choice: fix it or find new insurance.

Here is an electrical example that I have seen a few times. The Insurance company discovers that a home builder XYZ used Federal Pacific Electrical Panels in the homes he built in 1972 (because a fire in one of those homes caused a million dollar loss). Federal Pacific panels have a failure rate over 20%, they are obsolete, dangerous, and real hazard for starting an electrical fire. The loss prevention team then looks for other homes they insure that were built by XYZ in that year. They finder a bunch of them, but they also discover that many have pulled electrical permits to change those panels. Some homes have not. The insurance company does not want to insure those breakers, the hazard is that great. They send out inspectors.

From my experience, YOU SHOULD BE THANKFUL TO THE INSPECTOR IF HE FINDS SOMETHING. If he finds something, then there is a real legitimate safety hazard in your home impacting you and your family. The insurance company is not just creating work for random electricians and roofers - they are eliminating risks that they believe are too hazardous.

The inspector might find a hazard, and you might not be able to afford to fix it. And that will suck, because you will have to change insurance (to a company that does not require inspections, which will certainly be more expensive) and you will have to live with the hazard. But don't you want to know? I mean, do you know which breaker panels are electrical hazards, and which ones are not?

Do you know for sure that the room addition you built did not use the hydrogen sulfide poisoned Chinese drywall? The insurance companies know all about it, because they are getting sued like crazy over it. And they are out ahead of it know, dropping homes that have it in them.

Don't you want to know if there is a real hazard in your home? One so bad that it makes your home un-insurable? Let the inspector in.
posted by Flood at 6:57 PM on November 18, 2013

- - - No rezoning or flood plain changes.

Are you 100% sure on that? I'm sorry if I seem nudgy. But FEMA redrew the maps this year, and combined with post-Katrina changes to the flood insurance program by Congress which kicked in this year, I know it's leaving a lot of homeowners in my state in a bind --- they're finding themselves rezoned into higher risk catagories and can no longer be grandfathered in at their old rates.
posted by Diablevert at 7:43 AM on November 19, 2013

FEMA did change the flood plain maps recently, however they do not need to send an insepctor out for that. If you are in the zone, you are in the zone, and your rates are effected that way. (If your home is sitting high up in the flood plain, the burden is on the home-owner to get a survey done and show that although the home is on the flood plain, it sits above the flood zone).

Also, generally speaking, home owners insurance does not insure flooding. You have to get a separate flood insurance policy. The average home owners insurance company is not going to care about flooding, because that is not a risk they insure anyway.
posted by Flood at 10:14 AM on November 19, 2013

Nationwide did that to us after 10 years of never caring what our house looked like on the inside. The reason was that they had jacked up our coverage so much that it triggered an inspection requirement in their computer. Problem was, we never asked for them to increase our coverage, they did it all themselves. We fired them forthwith.
posted by Addlepated at 6:54 PM on November 19, 2013