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Country Estate Insurance

Discussion in 'Financial Management & Budgeting' started by Athene, Aug 19, 2012.

  1. Aug 19, 2012
    Athene

    Athene Power Conserver

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    I'm trying to price this and it's getting scary. At our current house, we pay $35/mo, and at the place we are looking at buying, it's more like $100/mo because it's no longer "homeowners" but "country estate" insurance. Are we getting raked over the coals here?
     
  2. Aug 19, 2012
    Hinotori

    Hinotori Super Self-Sufficient

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    Ours is just homeowners and runs about $400 a year. I'm in Washington state and this isn't a farm, just a house on acreage. We just raise stuff for ourselves.
     
  3. Aug 19, 2012
    Athene

    Athene Power Conserver

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    One guy I talked to said if it was less than 500 acres, it could be considered homeowner's if there were no farming activities. I said the front half was hayfield and would have to be mowed. He said if we made ANY money, it would be considered country estate. That's not even getting into animals, which we haven't moved so of course we don't have any as yet.

    Insurance is confusing under usual circumstances. I don't even know what to think here.
     
  4. Aug 19, 2012
    so lucky

    so lucky Almost Self-Reliant

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    I think you could go a long time without showing that you made ANY money. You may need to confer with a tax accountant as well as with a different insurance agent. I'm just sayin'....
     
  5. Aug 19, 2012
    Denim Deb

    Denim Deb More Precious than Rubies

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    One thing you might want to take into consideration besides the cost of insurance is the taxes. I'm not sure how the insurance works around here, but I know if you have land and make X amount per acre, your taxes are lower since it's now a farm. I think, but I'm not sure that you need 5 acres around here to qualify for that.
     
  6. Aug 19, 2012
    ~gd

    ~gd Lovin' The Homestead

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    Yep Insurance sucks. The first thing to check is your Fire Protection rating, how far to the firehouse that protects
    YOUR district [I was about 100 yards away from a firehouse but it was in a different County and fire district. The same for fire hydrants if you have them in the area] different fire houses in the same dristrict can have different ratings. Double check, The agent should know but some will claim not to know since their commission is based on your total cost.
    If you buy land+outbuildings+house make sure that the fire insurance covers the house and outbuildings, Agents will try to write on total sale price but the land almost never burns [I had to contract the home office to get this fixed] Libility insurance and personal property insurance should cover everything everywhere. Farm and country estate are quite different, Country Estate protects your family and stock used as pets [usually horses while farm covers the efforts to earn income and generally more expensive because of the extra risk. Even though my stock was only chickens and waterfowl. My company insisted on Country Estate, But after learning about tax breaks for farms. I awithched over to being a farm and got farm insurance from an agent that knew farm insurance. I had to reduce my farming plans to writing including income producing operations [for IRS] committed to no outside labor and only 'safe stock' no large animals etc. finished up cheaper than Country Estate and I could now write off losses from the farm against wages from my city wages.
    The IRS and I were both tickled pink that I made a profit the second year [selling ducks, eggs and hatching a few birds for sale] Then the price of feed shot up and I lost money on the farm...~gd
     
  7. Aug 20, 2012
    Athene

    Athene Power Conserver

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    I think - not certain, but I THINK- that it's less about profit and more about commerce, at least, from the insurance point of view. In my state, there is no minimum acreage required to get the ag use tax assessment. So thanks for the reminder, and I'll be looking into that very soon, but I am not sure if that impacts our insurance situation or not. It is my understanding that there are three types of property insurance that could apply to us: homeowner's, country estate, and agribusiness. I guess I'll need to look into agribusiness more. I just assumed that it would be higher, but now after what ~gd wrote I'm thinking it might not be.
     
  8. Aug 20, 2012
    ~gd

    ~gd Lovin' The Homestead

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    Keep in mind that insurance law varies GREATLY by state. NC has a long history of small plot farmers. At one time you could tell the status of the family by looking at their Tobacco crop. It was vary labor intensive to produce and extra help just wasn't available during the harvest period. If you had young ones that had left the farm you would try to get them home for harvest. Big agrabusiness is pretty new to the state and then mostly in Cotton or meat production. You can always tell what kids grew up driving tractors they take wide corners and drive the Yankees nuts. I would expect Nc to treat small farms differently than say IOWA..
     
  9. Aug 21, 2012
    Athene

    Athene Power Conserver

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    I'm in Michigan, so sort of in between NC and IO. We have a long history of small farmers here, especially where I'm at (the U.P.) We are the secondmost agriculturally diverse state in the union, after California. You don't get that distinction from monocrop agribusiness. That said, there are feedlots and stuff downstate (none here, thank goodness.) So the law is kind of all over the place regarding farming. They have tried to implement things like GAAMPs to specifically exclude factory farms from RTFA protections, but the trouble is that, legally, the distinction between a factory farm and a family farm is a slippery one.

    I've come to understand that a country estate policy is like homeowners in that it insures everything (livestock, fencing, buildings, etc) at replacement value. I'm not interested in that. I only care about the house replacement value and liability. So if they'll write me a policy wherein I can decide which line items I'm going to insure, I'll take that. Keep your fingers crossed for me, y'all!

    I did discover that in my state, farm equipment is exempt from sales tax. So all this research has not been for nothing. :lol:
     
  10. Aug 22, 2012
    Andy J

    Andy J Enjoys Recycling

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    I'm with you ,Athene.My homeowner's policy,full replacement value,got so expensive I had them put a dollar amount on the coverage.The premiums had gone up $100-$150 per year until it got to $1300 a year on my plain Jane 1450 sq. ft.brick home that I built myself 12 yrs ago.
    The company argued"You can't replace it for that cost."I told them if it burned to the ground or whatever destroyed it,I'd take the payout and build me a 16'X24' little cabin for my wife and myself and they could get lost.I got the premium down to $1025 per year.That is still very high,in my opinion.I'm in Mississippi,the poorest state in the union.Try getting insurance if you live close to the gulf.
    People complain about the oil company profits.In reality the insurance companies are the ones who are raping us.
     

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