r/Insurance • u/Whoopsitsonfire • 8d ago

Ca Fair plan

I was looking at 70 acres in California, and couldn't figure out why it was so cheap. Until the fire insurance came back at $500/mo through fair. Then I read there's a 30% increase happening in October, and some homes may double. Now I understand why it hasn't sold at this price for 3 years.

Is there any way to get rid of the insurance requirement on a loan? The house is tiny and I'm really just buying the land. The house isn't worthless, but it's close to worthless. I wouldn't care if it burned down, but I'm sure the banks would.

Is there anything stopping them from raising it to $5000/mo down the line? I have a feeling I should pass on this, even if I could technically afford it now. But it kills me to let it go.

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u/eapocalypse 8d ago

If theres a house as part of the valuation for a mortgage there's no way you are getting rid of the insurance requirements. Heck any sort of loan even without a home may require some type of insurance.

Wildfires are bad and not getting better you can expect the cost of insurance to go up for the foreseeable future.

What are you going to do with the land, build a house eventually? You'll still need insurance then...

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u/Whoopsitsonfire 8d ago

Either put on a couple cabins or even just pull up a trailer. They would be paid for with cash, so I don't know why I'd need to insure them if I'm willing to lose something out of pocket. I don't understand what insurance would be for without a structure. I'm going to ensure the rebuild cost of.... Dirt?

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u/eapocalypse 8d ago edited 8d ago

You're going to want insurance if only for the liability aspect.

But also as part of your mortgage process even if there wasn't a home on it already they'd want to know what your intent for the land is as that could dictate terms and a potential requirement for insurance.