Any insurance people on here?

[Larry Edgerton]

Any insurance people on here?
I am in the process of building a new house, it is roughed in now, and I am looking at what to do with heat.

At my last house I built a U shaped concrete structure under the fireplace in the basement, and in that spot was a woodstove that heated the fireplace from underneath. Four steps away was a concrete room, walls, floor and ceiling, sealed with a steel outside door and a chute on the outside that I could feed the wood into. The room was 14'x21', and would hold a winters wood. I would load it and put in a couple of bug bombs, and never had a problem with critters, and never had to go outside. Once the mass of the real fireplace was heated it held heat for days. Worked great, my ex appreciates it.http://familywoodworking.org/forums/images/smilies/doh.gif

Anyway.... I want to do the same thing with the house I am building now, but am having a hard time getting a straight answer from my insurance agent. Is there anyone here that works as an actuary, or can point me in the right direction?

The house is small, 1180 sq. ft., so an increase in insurance of any size can wipe out any saving I will make. My current house is the same size, and I average 7-800 dollars a year for heat and hot water. The new house will be more efficient, but has taller ceilings[10'8"] and a bit more glass, much of that with a Southern exposure.

It does not make economic sense to spend too much, or there will be no gain, and insurance has to be factored in. Part of it is that I like the idea of independance from the fuel companys in case, or should I say when, they raise their prices significantly. I can heat it with thedead wood on the property indefinately.

Before someone brings it up, an outside wood boiler does not make economic sense for me. There would never be a payback, even not counting my time collecting wood. On a small efficient house they will never pay for themselves before they need replacement, and they lose aprox. 50% of their heat to transfer losses, which means half of the wood I cut would be going into the ground or the atmosphere. Don't like cutting wood that much.

Thanks

Larry

[Larry Edgerton]

Really? No insurance people here?

Getting a straight answer out of an insurance company, or at least mine, I am finding to be difficult. I may switch carriers if I can find one that will give me a set of guidelines, and sign it.

[Ken Fitzgerald]

Larry,

I can see why an insurance company or bank would not want to insure or finance a home without a backup heating or hot water system for the wood stove/furnace. In the dead of winter if someone was gone for a few days and no backup systems existed for hot water or heat, water lines could freeze and damages result. I had some friends here who bought a home and had those problems when when they got ready to sell it.

[David Weaver]

I think you need an underwriter and not an actuary. The agent isn't going to deal with actuaries, but they will have to have policies underwritten.

If the insurance company has a number other than the agent (are you talking about state farm?), it might be easier to get information from corporate than the agent.

[Larry Edgerton]

Sorry Ken, I was not very specific. I will have a gas furnace as the primary as well as a gas water heater. Wood will be called backup, although it in reality will do most of the heating and hot water.

David, good guess, that is who I have been trying to get a set of guidelines out of. I was wondering about an actuary as these are the people that are involved in the guidelines at their inception.

I know that the system I have planned is safe, or at least as safe as a wood system can be, but I want approval in writing before I procede just to keep the rates down. I have known of insurance companies that double the rates with wood heat, as I would considering some of the setups I have seen. My setup with masonary will survive a chimney fire if need be, and my shingles are not cedar. The system can be cleaned from the basement as I have it designed, so other than the mess it is not a big deal to clean the chimney. All I have to do is pop off the metal pipe. 1/4" wall by the way, and run the brush up from the bottom. There was never a problem with cresote in the old house as the chimney stays warm in the center of the house, and it was insulated in the attic from the ceiling to the roof with 2" foam, and between the brick and the block on the outside with 1" thermax. That is the big problem with metal chimneys, they allow the gasses to cool before they exit the chimney, and the gasses condense as cresote.

I am just trying to develop this house/shop complex with the least amount of overhead, insurance being one of the unavoidable costs. The more I can cut costs, the less I have to work.....

[David Weaver]

The agent probably is hesitating because either he knows underwriting won't like it, or he's unsure how to submit it. I would imagine state farm agents are tracked by policyholder experience, but I don't know that for sure.

If woodstove rates are double, it usually because the loss experience of the cohort with woodstoves is about double. I'm sure it's a little more complicated than that, they may take some extra margin for reserving because of the increased risk.

I think what an actuary would tell you is that they don't deal with data as fine as you're looking to go, because there just isn't enough data on people who have a stove system like yours with wood in the house. They may by policy exclude coverage for people who have large amounts of wood in the house just because they have old data showing that the risk is a lot higher, and they may exclude it just because they don't know how to quantify it. Their level of how fine the data is is probably limited to indoor wood burners and outdoor wood burners with parameters on how they need to be set up to be able to get coverage.

You might want to talk to some agents at other companies. When you start getting really specific about details, you can end up in different ratings categories and find that one place will really mind something that another doesn't mind at all. In general, it's hard to beat state farm's prices, though.

If you keep running into a wall with the issue, you might want to just figure on storing the wood outside as it'll be worth the cost.