 Hi, welcome to Property Time. I'm Sarah Morrow, Realtor with Cell State Peak Realty. Today I'm speaking with Brooke Colvin, who has been a loyal farmers insurance employee for over 12 years. She's also a homeowner's insurance expert. She started out answering phones, directing questions to their respective authority on topics, and now she is that authority. She advanced to sales and then to office management before taking over an entire book of business for a retired agent. As if that's not enough, Brooke hails from Alamosa. She's been married for over seven years now. She's a true Firestone family woman as the mother of a four, a two, and a one year old. She and her husband own their home. They love camping in very remote parts of the state. And she has a very sophisticated palette for a good craft beer. She competed in 4-H growing up and she was known for showing sheep and she could shear a lamb perfectly in under 20 minutes. Because she's so efficient, she's highly attentive to her client's needs and their unique situations, even with the demands of a family. And she knows what it's like to prevent hardship and overcome obstacles. Please join my discussion today with educator, community servant, cancer surviving warrior, and client lover, Brooke Colvin, as we help you better understand and ensure your greatest asset. Hi. Thank you so much for being here. Thank you for having me. I'm so excited to talk all things insurance with you. Yeah, me too. Let's launch right in with, why don't you tell us a little bit about like your role, farmer's insurance, what you love about your job and what you're most excited, especially right now about educating your clients on. Absolutely. So I am the owner of farmer's insurance. I'm also a licensed producer within the agency. So I do a lot of the sales stuff. I am so excited right now with all of the home insurance questions that have come up from the recent Marshall fires. There's so much for people to learn that I'm just, I'm excited to help people go through that and learn the coverages that they need. Hmm. Yeah, what a tragedy. It does seem timely that we're discussing this because we do, we sort of forget about our policy until we really get forced to think about it. Yeah. So it's really horrible for those folks, but like you said, it's an opportunity to learn and grow and move forward. And I appreciate you being here to share that with us. I've noticed the word uninsured has become not only a concern or underinsured. I guess I should say nobody's really uninsured, but underinsured is a huge concern right now. And it's almost even a buzzword. Can you, I mean, when you hear, oh my gosh, we're underinsured. Are you thinking, yeah, guys, I've been telling you that for years. Like, yes, you're very underinsured. And us agents have been trying to get that through your heads. Yeah, it's something we go through, you know, telling people this is what we recommend. Here's kind of what the county assessors giving out is what your insurance coverage should be. It's important to keep in mind that we don't necessarily cover the land or the inflation of the home market because Colorado's crazy. Ever. Those aren't right. Land and appreciation just are off the table. Yep. Because it's not something that you're going to lose. Should you lose your home? Sure. So we like to look at the county assessor and kind of based off of that, we come and say, okay, this is what we recommend you should have. With the recent fires, though we're finding that there's not a lot of builders in the area and there's thousands of homes that need to be rebuilt. So the builders are coming in and charging what they want to charge. So the price per square footage has actually gone up, which we're finding a lot of people then at that point become underinsured or not insured at all. And they might only get a third of their house as opposed to if it was only their house that burned down, they might be able to replace their home for what their coverage is. So I see. So without getting too deep into the weeds about your specific product offerings and specifically what the builders are covering right now, can you at least give us a sense, let's take a giant step back. What is replacement cost coverage? What is guaranteed replacement cost coverage? And what is actual value, actual cash value coverage? I know those are the three main ones and every agency's a little bit different. Can you at least start there for us? Absolutely. So I'm gonna start with actual cash value. Okay. Because it's the one I don't think you should have. You should have replacement cost. But the actual cash value, what it is is if your home was built in 1970 and it's now 2022, your home is old. And if you have actual cash value, the claims adjuster is gonna come in and say, okay, your home was built in 1970 or now in 2022, it's this many years old. Here's the value it would take to replace it. But now because your actual cash value, we have to deduct the years old it is. Mine is sure deductible and you're gonna be left with a small, small check. Got it. Which isn't gonna build you anything. So that money's gonna come out of your pocket to build your home. Got it. Extended replacement cost basically means that we're gonna give you the dwelling amount. So if your home is insured for 500,000, we're gonna give you that 500,000. And then the extended replacement cost for my agency is either 25% of the 500,000 or 50%. So if you have the 25% in total, if you have a total loss, you're going to have $750,000 to rebuild your home and a $500,000 home. So that's a good option. The best option out there is guaranteed replacement cost because that means if you have a $500,000 home, dwelling insurance coverage-wise and you have that guaranteed replacement cost, we are going to pay whatever it takes to rebuild your home. So if a builder comes in and says it's going to be $2 million to rebuild your home, we're gonna pay that $2 million. Got it. Now when you say 500,000 dwelling, that's a type of coverage that I might have. That's not necessarily the value of my home today. It's 500,000, right? Correct. So how we come to that number, we have a system within our quoting system that says, okay, how many bedrooms do you have? How many bathrooms do you have? Two-story, one-story brick, citing veneer, you know, all those property details. We put in all that information and our system gives us a number. So that's roughly an appraisal process that happens to get to the dwelling coverage, then you get the replacement, the guaranteed replacement on top of the dwelling coverage. Exactly. I see. And that's how you arrive at, we will cover up to $2 million or infinity what it takes to replace it. Exactly. Now that's the rebuilding part. I've heard, it's like the three R's in my mind. There's rebuilding, there's replacing and then there's renting, right? Like, let's be honest, if my house burns to the ground today, I need to do all three. Yes. I need a house, but I need the stuff in my house and I need to rent somewhere because I don't have a house, right? Yes. Yes. So content-wise, so contents is going to be, if you took your house, turn it upside down. Everything that fell out would be considered in those contents. Okay. So your time policies are replacement costs for those. However, it can be actual cash value. So that's something you would need to dig on to find out what you have. But replacement costs, we will pay to replace those items. So your TVs, your furniture, your clothing, your silverware, computers, musical instruments, those type of things. Like all personal property. All personal property. Whatever I can dream up. Whatever you can dream up. Oh, man. Would be in your contents and those are usually replacement costs. As far as renting goes, a lot of policies have some minimal coverage built in. It's called additional living expense or loss abuse coverage. So what this is is it's an amount that you have to go rent somewhere else in the time where you are not able to live in your home. So if it's a total loss, if you have a claim that it's deemed unlivable for you to live there while they're fixing it, those are gonna be times where you need that additional money. And so that will go towards renting a new place, utilities at a new place, even food at the new place. Oh, wow. And that's all going to be out of your pocket if you don't have it on top of having a mortgage for your home that you're rebuilding or replacing. Right. And that is probably the most stressful part for people who are victims of the current martial issue is not only do I have no home for my family, but I still have a mortgage. I still have to pay it every month. I've got these payments. I've got these utilities and I've got to go find a place to rent. It's crazy. It's like tripling your bills and overnight. Yes, matter of 20 minutes. It's insane. Right. So how do I know if I haven't looked at my policy for a while, how much I'm covered for and God forbid a fire happened in my neighborhood. That's gonna spike my premiums, right? So it will. You know, we've had a couple of big fires in the last two years in the area, martial fire being the most recent. The zip codes where the fires are happening are going to see a really high premium increase, unfortunately. And then on top of that, the other zip codes in the state of Colorado are also going to see a great increase, probably not as high as those directly impacted by the fires, but you are gonna see a great increase. So I highly recommend that you get with your insurance agent. You talk to them. You say, hey, what's my dwelling covered for? Do I have extended replacement cost guaranteed? Do I have actual cash value? What other coverages are out there to make sure I'm properly insured? So there is no real way to know exactly what I have until I speak with my agent. You can look at your declaration page. So that's gonna be what you get on an annual basis. It's got your renewal information on there. You'll see the coverages listed out, your dwelling, your additional living expense. And there's several others that go into that, but if you aren't educated on it, you're not gonna exactly know what it means. And each company has a little bit different meaning behind it. We're all providing the same type of coverage, but the way it's worded could be a little bit different. And outbuildings and roof, just like personal property and just like guaranteed, these are all sort of stacked on top of, which can complicate your policy. But again, it's really unique and individual, right? Like I have to look into these nuances of my specific case, yes? I would highly recommend looking at your specific policy. Yes, you can talk to your friends and family about home policies and everybody will tell you, you've got the dwelling coverage, you're fine. But it's different for each individual household because not every house is the same. So especially since there are so many older homes in Longmont, like you said, not only is this actual cash just not gonna cut it, but I mean, when you factor in depreciation and just the values appreciating like crazy right now, you're gonna get a tiny little check to go like run off and try to live your life with. It's very stressful and crazy and it certainly has inspired me to take a look at my policy. So that's another question I have for you, like as appreciation rises in Northern Colorado and the whole country really, are you seeing like prohibitive rates for people? Like if they do get this guaranteed replacement cost coverage, which is of course really necessary, like is that part of what's keeping people very underinsured is just prohibited costs? And are they rising just as fast as appreciation or? I would say, yeah, premiums are going to rise just as fast. Significantly, yeah. Everything is gonna start costing a little bit more just because that's the type of economy that we live in and with the hail storms that we've had or we get and the fires that we've had in the recent years, insurance is going to increase and a lot of people are still stuck, you know, 10, 15 years ago, I have a $500 premium for the year. I can have a $250 deductible and that's just not the case anymore. Right. Those were the days, right? So yes, they will rise, they will continue to rise unless someone can figure out how to stop the hail and the fires. Good point. So, I mean, what if I don't wanna? Like what if I don't wanna, if I don't wanna pay insurance premiums or if I insist on having this bare bones plan? I mean, do I, am I, basically I assume I'm at a higher risk? And similarly, can you also answer the question, what if I just don't wanna rebuild my house? What if it was built in 1947 and I just don't want it? What do you guys do in that situation? Yeah, so obviously you don't have to go with the highest of high policies and have the best of best coverages. You can self-insure and just start setting money aside for claims to happen and then you pay out of your own pocket. That's totally up to you and what you wanna do. I will just kind of go off that a little bit and say if you are, if you have a mortgage or you're going to be buying a home, probably not going to be allowed based off what your lender says. But that's besides the point. It's their security, it's their property. Yeah. So, if something happens and you don't want to rebuild the home and you have a mortgage, that is fine. You don't have to rebuild the home. We have said as an insurance company, look, you have dwelling coverage amount of 500,000. Here's your 500,000, do what you please. If you have a mortgage though, you're going to have to pay that mortgage off. Okay, that makes sense. And then you still own the land. So the land could be income to you to go put a down payment on another home or it might be you have to sell it to finish paying off your mortgage. It just kind of depends on where you're at in the life of the mortgage. And if you can survive long enough, you could potentially rebuild on your own later and be the owner of that land. And I assume you've seen all these. Can you give us any anecdotal? You know, I mean, like you said, non-compliance to a point. Yeah, so I actually had a client who lost their rental property in the Marshall fire. His tenant did not have renters insurance. So he lost all of his contents that he was going to self-insure and that's fine. But my landlord client, he had some coverage, but it wasn't enough. So what's he going to do? He, you know, I've tried to sit down with him for several years and tell him it's not enough. Look, let's go ahead and do this. And it was his choice not to, and that's fine, I respect that. As of today, he is looking at selling other places and other states to be able to rebuild the home. Within his portfolio. Within his portfolio, but if he can't do that, he's not going to rebuild. He will eventually sell the land to someone who wants to build a home there. Sure. Yeah, and that's a good point. I mean, he's got to do what the numbers tell him to do if he hits an investment property, right? And he, you know, that's a great point for us investors. You know, like of course we want to protect our greatest asset, our primary residence, but some of us forget just how important the insurance situation is and the appreciation is, especially if it's out of state on your second, third, fourth home, vacation home, short-term rentals, long-term rentals in your portfolio. And it's kind of scary. And thank God that guy has some other resources he can pull from, but it can majorly impact your whole portfolio and your wealth. Absolutely. Your nest egg. You've been so wonderful. I so appreciate all this information. Can you just tell us, you know, because things are happening so rapidly and appreciation's going so bananas, there's got to be something we can do today. Maybe I can't even sit down with my agent today. How often do I do that? What do I talk about with them? And what can I do at my house by myself? Like there's got to be like, do I just go home and read my declarations page and pray to God and like, give me some tips on like being proactive. Tip number one, always meet with your insurance agent. You meet with your doctor on an annual basis to make sure you yourself are healthy. So you should look at your insurance agent as a doctor for your home. Got it. You should be meeting with them annually because during that annual appointment, they're going to be able to break down what coverage as you do have, how it's going to work if there is a claim, what to expect, what other options are out there as far as are there new coverages this year? Is there a different product that might be better suited for you or maybe even save you money? They're going to be really the ones you want to go to to kind of look at that. Yes, you can go home and look at your declaration page. I suggest you do that as well. But number one is call your insurance agent and at least get something on the books. Yeah, and I just, you know, I hate to compare this to death, but it's got to be, you've got to probably be somebody who sees people grieving and trying to make really important tough decisions and or seeing their deep regret at a time when they've just lost everything, being traumatized, it's not the time to learn about the details of your policy. So I'm sure that's, yeah, I mean. Number two, I would say go to your house and go through each room, whether it be putting together a notebook, putting together an Excel spreadsheet or even taking a video with your phone, just video each room. And if you have special items, take a little bit longer clip of them explaining what they are. And then for my clients, they actually offer that they can send those to me and I'll keep them on file so that should something happen, they don't have to worry about finding it. They know it's with me. I can get it to the claims adjuster right away. It's quick and simple. Yeah, as a musical instrument owner, I am thinking right now about how I'm gonna do that. I need to do that. Yep. Very important to have those things documented. Cause even the video in my archives could get completely lost, right? And then I was trying to remember all the things I owned and the brands of my jeans and my computer monitor. Yeah, it sounds very stressful, but that's a great idea. So then you step in and help us evaluate or value that later. Yep, so once you do that, obviously I'll watch the video if they send it into me or I'll look at their list and say, hey, okay, I think this is kind of a high priced item, high replacement cost, whatever it may be. Let's get it appraised so that we know exactly what it's worth. And then they recommend appraising everything about every five years cause things fluctuate so much. So usually a good roll of thumb is anything over $1,500 individually. Probably needs to be appraised and put on a floater policy that's attached to your homeowners so that in the event you lose it or get stolen or whatever it may be, we can go back and say, hey, this is exactly what it was. Here's the replacement cost. It was appraised three years ago. This is what the person is entitled to. Cool. Now do you work mostly with first-time home buyers? Do you have a large book of business of all types? People different phases of life. I would say large book, all phases of life, all kinds of insured, some who like to self-insure, some who want the top of the line. I don't care what the premium is going to be. I really enjoy working with first-time home buyers because it's such an exciting time for them. They just went under contract. They're going to be moving into a new home that's theirs. They're going to be building equity. I would say those are my favorites. The other ones I've kind of migrated into are mountain homes. So not a lot of companies will do mountain homes and I've found a market to do that in, especially the higher value mountain homes. Good for you. Is it high risk? High risk. Scary. Super high risk. Premiums aren't cheap, but that's kind of what you get for wanting to live in the mountains. Houses are gorgeous, but just being able to break it down and say this is the coverage you need, we need to get the fire department involved because now we have to know how many tankers and pumpers and a whole bunch of stuff goes into it and it's super exciting and fun to be able to learn about all that. Yeah, well, I love your hunger for knowledge. I love your hunger for teaching and educating. That's kind of what I want to do on this show. How can people reach you and pick your brain? Yeah, so you can contact me on my office number, which is going to be on here, but it's 303-776-3118 or you can send me an email at brookcolvinatfarmersagent.com. Either one of those I will respond to usually within a two hour time frame. So, whether it's weekends, nights, days, I am available 24 seven. Busy mama. Good to realtors, good to her clients. Thank you so much for your time. Thank you, brookcolvin everybody. That's the proper tea.