I’m gonna admit that I’m one of those. The main reason is basically not knowing any different. The whole industry is pretty opaque and made even more so by the discounts for multiple policies (auto+home).
How would you go about finding and selecting a trusted independent broker?
My understanding is that any broker will give you the same quote, so not sure if or why you’d need any special level of “trust”, other than to make sure they’ll be around if/when you have a claim or need to make changes to the policy and need to contact them (and sometimes you can contact the insurer directly for such things). You can often find links to local brokers on websites of insurance companies who sell through brokers (some only sell through brokers). You can also search in your area on google or yelp.
Some put on discounts you don’t qualify for, presumably you could be denied when making a claim. I got a quote for auto insurance the first time from the “broker” my family used. The quote included things like an X years driving discount (when I just had started), as well a senior citizen discount.
It’s amazing how basically NOBODY reads the contracts on anything they sign or buy.
I was with State Farm for four or five years with two vehicles, a renters policy, and then ended up with a H06 policy too after we bought the condo, and they were significantly higher. Also, the condo’s replacement threshold was at $200k, when it needed to be half that. I have since had them lower that to $100k (which is probably overkill still), and moved everything else to Geico (cars) or Progressive (motorcycles). I flip flop every few years. I had an umbrella with Geico but they required my bike to be at the 300/300 limit and it had to be added to the policy, which caused the policy to 3x in cost. I dropped it and self insure now. Only thing I really worry about is the dog.
That seems like a low replacement cost. How could you rebuild a condo in 2019 for $100k? Would a certain portion of the rebuild be covered by the condo association?
For 1255 sq ft, 2 bedroom, 1.5 bath built in 2000? I’d say the most expensive thing would be the kitchen, at somewhere around $20k. Everything else is wood and sheetrock. Hell, even our hardwood floors were $4500 all in (I did the work).
And, what are the odds that the whole condo goes down? We have a fire department less than half a mile away, with a hydrant about 50-100 feet away, and have fire extinguishers all around the house. No flood worries. Everything outside the walls is covered by the HOA’s policy.
Unless there is a sprinkler system, I’d say the odds the whole condo burns down is just as likely as the condo sustaining some fire damage and not needing a full rebuild. Fire departments are great at rescuing people and extinguishing fires, but not great at doing it before the structure is a total loss. The other consideration for condos is the fact that there are multiple times (I don’t know how many units are in your building) as many ignition sources, and every one outside your home is one you don’t have any control over.
That being said, fires are still extremely uncommon, so I don’t fault anyone for getting the minimum coverage their mortgage holder requires. I haven’t increased my insurance coverage since I bought my house 10 years ago, but I readily acknowledge that if it were to burn down, we would likely end up in a significantly smaller home or in a worse neighborhood. You can’t build anything decent around here for $150,000.
But don’t conflate “build” with “rebuild.” Meaning, the main structure is covered by the HOA’s policy. Our H06 policy only needs to cover internal stuff, such as non-structural walls (there are none in our unit), sheetrock, flooring, and fixtures/appliances. I’d have to guess that the foundation, structure, siding, and roof are a very significant cost when “building.” The HOA’s policy will cover my shell, and I cover the internal layout/functional stuff.
That’s what I meant in my first post. When you replied and said “everything outside the walls is covered by the HOA,” I didn’t figure you meant that the foundation, structure, siding, and rood were covered by the HOA. Your most recent post makes more sense.
I sent Farmers a quick email ping and the agent responded with, “I thought we sent the quotes to you two weeks ago”. 
He sent me 3 out of the 4 quotes that I requested and in total, I would be paying at least $450 more to switch to them. 
Also, their condo policy has a $12 “Policy/Membership fee” and their auto policy has a $15 “Policy fee”. 
I guess mentioning it’s a townhouse would probably have provided better context. My bad.
We just moved out of a townhouse-style condo about six months ago.
The HOA carried an unusual policy that covered walls out + permanent improvements to the home. It meant our HOA fees were high but it allowed us to get a policy with minimum dwelling coverage. It was essentially a renters policy.
As far as replacement cost… I’ll warn you and just say that it depends on your region and what kind of build/rebuild you want to do. Just having gone into a new house and having sold the townhouse, I have a decent amount of recent experience with selecting contractors and getting bids for work like this. The old saying is right, you can’t have all of cheap/fast/good. You only have two of the three. If you have low quality, builder grade materials, you can probably get away with lower dwelling limits. Otherwise, take a good look at what it would take to rebuild your home - don’t forget stuff like permits (which are sometimes free for catastrophic loss rebuilds), sales tax (here it’s 10%), contractor profit, unexpected “discoveries” that jack up the price, etc.
Doing the work yourself can save you money for sure but that may not be sustainable given lack of knowledge, the need to work your regular job during the day, stress, etc.
It’s worth noting that the insurance company is on the hook for the policy limit, no matterr how much more it may cost to rebuild (you’re on the hook for paying the difference). In my case it would’ve been stupid and cost-ineffective to rebuild, with nearly identicle houses available for half the rebuilding cost. So I kept a policy limit less than needed to rebuild, but high enough to still allow for a settlement of any total loss claim - where I could take the settlement money and just buy a similar house down the road.
It’s also worth mentioning the shenanigans with replacement cost and depreciated/actual cash value. You don’t want to file a claim on your 15 year old roof, only to have the insurance company pay half the cost because that’s all the old roof was “worth” regardless of the policy limits.
You don’t have to work with just 1 broker, you can just forward your current policy’s declaration page and they’ll do the work for you. The price won’t be the same across agencies, because they are tagging on their own commission.
That’s true, but policies tend to be over insured (more profit for the insurance company). Keep in mind that we are talking replacement cost, which does not include the value of the land, or current market price for similar homes. For most cookie cutter homes this is somewhere around $100 per square foot.
Another area that’s often over insured are your possessions, which is sometimes automatically set at 50% of the dwelling limit. How much of your crap would you actually be repurchasing in case of a total loss? And you also need to catalog it somehow or else forget most of it when making a claim.
I do agree with getting coverage for replacement cost.
So practically where would you recommend uploading your declaration page? Like Policy Genius for example?
I can’t speak for @Strust, but what I do is find a half dozen independent brokers, and fax them my declarations page. This way, you don’t have to repeat the same info as someone writes it down, and you’re close to guaranteed of comparing apples to apples. Additionally, one of the brokers may have suggestions that save money or better protect you.
I’ve had one great broker in my life - he was a wealth of info. Although not the cheapest when it came to rates, he saved me money. It took four years to find another good one, and then we moved … the search continues.
I just tried Policy Genius for the first time and they said I already have the best rate with my current carrier. 
I should mention there is one benefit with staying with one insurer. All of them have some kind of “accident forgiveness” even if they don’t advertise it. For state farm it’s something like one incident per 9 years. True to their word, my rate didn’t go up due to one accident that’s partially my fault.
How long do accidents stay on the CLUE report? 10 years? If so,there’s no real advantage unless the forgiveness is much more frequent.
Due to recent events, I have to take back my previous recommendation for Farmers insurance. I’m not shopping around right now, but am considering it for the future.