Mutual Myths
You may have heard a few things about Mutual Assurance—perhaps that we insure only one home on a block, or only brick homes with slate roofs. Some of these stories have been around for decades. They're also not true.
Here are the facts behind some of the most common Mutual myths.
MYTH
Mutual Assurance will insure only one house on each block.
TRUTH
We are happy to insure multiple homes on a block. As long as each dwelling meets our underwriting criteria, which includes necessary safety considerations.
MYTH
Mutual Assurance insures only brick homes with slate roofs.
TRUTH
Mutual insures all types of homes, condos, and apartments throughout Virginia. As ever, each dwelling must meet our underwriting criteria, and the home's construction and roof type affect the initial policy premium and annual assessments.
MYTH
Mutual Assurance insures only houses.
TRUTH
We are happy to insure your home, apartment or condominium as well.
If we insure your primary home, we will also insure a secondary home or rental property.
We also offer a Personal Umbrella to our members, and through our new Mutual Assurance Agency, we may be able to offer a quote for car insurance and other coverages that Mutual doesn’t directly provide.
MYTH
A homeowner's insurance policy is like a home warranty, providing coverage for standard repairs.
TRUTH
Don’t expect to be able to file a claim to help offset the costs of maintenance or the cost of damage caused by wear and tear, mold, or similar issues. a perceived lack of maintenance. Although we are proud of the broad coverage our Preferred Homeowners policy provides, it is generally intended to cover sudden and unexpected losses, and not routine home repair.
MYTH
I will pay little or nothing each year for coverage from Mutual Assurance.
TRUTH
Unlike other insurance companies, Mutual Assurance issues a perpetual homeowners policy. This is a policy without expiration. Both parties agree to keep the policy in force without an expiration date as long as the conditions of membership are satisfied. As an FYI, other insurance companies issue policies that usually expire after a year, and then both parties renew it.
With Mutual, at each policy “anniversary,” members are charged what we call an assessment. Set each year by the Board of Directors, these payments cover the ongoing costs of the Society and are based on a percentage of the policy premium. These assessments can be from 1% to 200% of the policy premium but have held steady at between 20-22% for decades.
The Board looks at the following to determine the annual percentage amount:
• insurance income
• reinsurance costs
• loss and loss adjustment expenses
• underwriting expenses
• investment income and investment performance
As an example, a homeowner with an $1100 premium would pay $220 with a 20% assessment that year. If the assessment goes to 22% the next year and the premium stays the same, he would pay $242.
There is a minimum annual assessment of $125 to $350, depending on the policy.
By comparison to what you would be paying to a big box insurer, you may think an assessment of 22% is next to nothing. This is why we say “yes and no” to this myth.
MYTH
If I move out of state, I can take my Mutual Assurance policy with me.
TRUTH
Mutual Assurance insures only homes in Virginia. If you are moving within the Commonwealth, we’d be delighted to entertain coverage on your new home, and will even offer a current member discount for homes that qualify for coverage.
With more than two centuries of history, a few myths are bound to linger.
Mutual Assurance works differently from many traditional insurance providers. Our perpetual policy, pricing structure, and inspection process are all part of that difference, and a conversation is often the best way to understand how it all fits together.
Call us at 800-648-1794
If you’d rather start with a quick quote, you can also get one online.
