Colorado Homeowners Left Reeling from Marshall Fire: Take Action Now to Avoid Financial Fallout
A recent study by economists revealed that many Colorado homeowners are woefully underinsured, leaving them vulnerable to financial ruin in the event of a disaster. The research examined 3,089 policies from 14 major insurers held by people affected by the devastating Marshall Fire, which burned over 1,000 houses in suburban Boulder County.
According to the study, an astonishing 74% of homeowners were underinsured, with 36% holding policies that covered less than 75% of the rebuild cost. This staggering number holds true even for households with incomes above $180,000, where 72% held insufficient coverage.
So, what's driving this trend? The researchers point to rising insurance premiums in Colorado, which have increased by nearly 60% over the past five years due to mounting losses from wildfires, hail, and other disasters. This trend is not unique to Colorado but reflects a broader national reassessment of risks.
The study found that credit scores and mortgage debt amounts were unrelated to how underinsured people were, highlighting the need for homeowners to take proactive steps to ensure adequate coverage.
When shopping for insurance, many homeowners focus on the total cost of the policy rather than the actual coverage level. However, this approach can leave them vulnerable to underinsurance. In fact, if shoppers compared insurer quotes for the same coverage amount, they would gain around $290 per year in value, roughly 10% of the average annual homeowners insurance premium.
The researchers stress that underinsurance isn't just an abstract problem; it leaves real gaps in rebuilding and can even prompt families to sell their properties and move away. In contrast, if all underinsured households had been fully insured, 25.4% of homeowners would have filed for reconstruction permits within a year of the fire, compared to the actual 18.8%.
So, what can Colorado homeowners do now to avoid financial fallout? Here are some practical steps:
1. **Request side-by-side comparisons** when getting quotes or renewing policies to ensure you're not underinsuring in pursuit of a lower premium.
2. **Revisit limits annually**, especially after renovations and big economic changes, to reflect rising construction costs.
3. **Consider insurer reputation and local presence**, as companies with deeper roots in the community are less likely to underinsure.
By taking these steps, homeowners can ensure their coverage keeps pace with rising risks and rebuilding costs, helping them avoid financial ruin in the event of a disaster.
A recent study by economists revealed that many Colorado homeowners are woefully underinsured, leaving them vulnerable to financial ruin in the event of a disaster. The research examined 3,089 policies from 14 major insurers held by people affected by the devastating Marshall Fire, which burned over 1,000 houses in suburban Boulder County.
According to the study, an astonishing 74% of homeowners were underinsured, with 36% holding policies that covered less than 75% of the rebuild cost. This staggering number holds true even for households with incomes above $180,000, where 72% held insufficient coverage.
So, what's driving this trend? The researchers point to rising insurance premiums in Colorado, which have increased by nearly 60% over the past five years due to mounting losses from wildfires, hail, and other disasters. This trend is not unique to Colorado but reflects a broader national reassessment of risks.
The study found that credit scores and mortgage debt amounts were unrelated to how underinsured people were, highlighting the need for homeowners to take proactive steps to ensure adequate coverage.
When shopping for insurance, many homeowners focus on the total cost of the policy rather than the actual coverage level. However, this approach can leave them vulnerable to underinsurance. In fact, if shoppers compared insurer quotes for the same coverage amount, they would gain around $290 per year in value, roughly 10% of the average annual homeowners insurance premium.
The researchers stress that underinsurance isn't just an abstract problem; it leaves real gaps in rebuilding and can even prompt families to sell their properties and move away. In contrast, if all underinsured households had been fully insured, 25.4% of homeowners would have filed for reconstruction permits within a year of the fire, compared to the actual 18.8%.
So, what can Colorado homeowners do now to avoid financial fallout? Here are some practical steps:
1. **Request side-by-side comparisons** when getting quotes or renewing policies to ensure you're not underinsuring in pursuit of a lower premium.
2. **Revisit limits annually**, especially after renovations and big economic changes, to reflect rising construction costs.
3. **Consider insurer reputation and local presence**, as companies with deeper roots in the community are less likely to underinsure.
By taking these steps, homeowners can ensure their coverage keeps pace with rising risks and rebuilding costs, helping them avoid financial ruin in the event of a disaster.
Colorado homeowners need to step up their insurance game ASAP 
You'd think that with income above $180k, folks would have more wiggle room, but nope! Rising premiums in CO (60% increase in 5 yrs) must be driving the trend. People need to stop focusing on total policy cost and start checking coverage levels 
. Even a $290/year difference can make a big difference. Families aren't just losing homes, they're selling everything and moving away because of underinsurance 
. Take these steps: request side-by-side comparisons, revisit limits annually, and check insurer rep & local presence 
. Let's get Colorado homeowners insured for real! 
And don't even get me started on the idea of shopping around for quotes - like I haven't spent enough time on those websites already, can't they just give me a decent rate to start with?
I mean, I guess if you want to sell your property after a disaster, that might be a consideration, but for most people, just getting enough coverage seems like the bare minimum.
. It's crazy how many of them are underinsured - like 74%! That's almost three-quarters of people. If you're one of them, it's super important to get your insurance policies checked ASAP 
. They're saying that rising insurance premiums have nothing to do with how much coverage you need, which is weird 
Anyway, the researchers are saying that if everyone got fully insured, more people would be able to file for reconstruction permits, and less families would have to leave their homes.
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I'm telling you, insurance companies should just chill on raising premiums and make sure people have decent coverage from the start 
. This whole "you need to shop around" thing is just a headache for homeowners. And don't even get me started on credit scores not mattering - what's next? 
Just because you're good with money, doesn't mean you won't end up broke after a fire 
. People should be prioritizing coverage over cheap premiums for once 
.
. I mean, who knew insurance shopping was so complex? 
️. And it's not just about saving money, either - underinsurance can leave families with huge gaps in rebuilding costs and even force them to sell their homes 
. And it's not just Colorado, either - I've seen similar trends in other disaster-prone areas nationwide.
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. We gotta make sure we're prepared for the unexpected & that our homes are protected against natural disasters 
It's like they're playing with fire (literally) and not knowing the risks. Rising insurance premiums aren't helping either. Like, what even is that? 
But no, seriously, it's all about being proactive and shopping around for better insurance deals. Side-by-side comparisons are key! 
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!
. They're saying we should compare quotes side by side and check our limits every year 
. Trust me, you'll be the one crying when disaster strikes 
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️ The Marshall Fire was devastating, but many people are still reeling from the costs 
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! That's huge 
. So, what's holding people back? Time to take action and protect your home and finances 
. Get it together, Colorado homeowners! 
. They're messing with our minds, distracting us from the real issues while they're getting richer off our insurance premiums 
. And what's with the 'reputation' factor? That's just a fancy way of saying they're trying to control us through their 'trust' and 'loyalty' 
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. If everyone just did their due diligence, I bet we'd see some amazing savings 
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. But hey, at least there's hope now! If we all just take these steps and make insurance our priority, maybe we can prevent some of this financial fallout 
. And it's not like they have any idea what's going on - they're just focused on the total cost of the policy, not the actual coverage level 
. I mean, 74% of Colorado homeowners are underinsured? That's wild, right? And it's not like they can just fix the problem by increasing their premiums, because insurance companies are already hiking those up by 60% in the last five years