Best reply by Injun:
Depending on where you live, your rates can be higher or lower. If your in the inner city, almost always your rates will be higher…
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Why do insurance companies ask if your house is within city limits, to give you a homeowners insurance quote?
Fire protection is a big concern for the insurance companies. The house location and better fire protection will have a lot to do with the cost of insurance.
It is very important, because they and you, need to know where a water supply is located, and which fire station serves your property. For example, if you are out in the toolies and served by a volunteer fire dept., it would cost more than being in a city with a fire hydrant on the corner. Best wishes, stay safe.
–ask your insurance company, trust me they will love to answer your question precisely.,
http://www.insurancepolicy.com
Insurance companies use what is known as a GUS reports this lets them know what territory you are in. GUS is rated 1-9 example 3-4 being your normal neighborhood and 9 being a farm. If you are outside the city limits but have a fire hydrant with in 1000 feet and a fire department with in 2 miles it really does not madder. But your insurance agent will need to know who the responding fire department is. In the next few years the Insurance companies will start using zip code rating with is going to replace GUS. You need to find an Agent that knows your local community so they don’t have to ask you question. Finding an agent that you trust and is willing to help you with all your question is worth more then trying to save a few dollars. When shopping for Home Owners Insurance find out about your Auto as well and try to keep them with the same company this too will save you money.
In a lot of cases it has to do with fire department response time and/or the availability of a paid fire department.
If you live in a metro area with a paid fire department, and your zip code shows a response time of 3 mins or less, and you have a fire hydrant within 1000 ft of your home…… your insurance is going to be a lot cheaper than mine, because I live in the county, even though the town nearby that services our area is manned, the response time for my area is 8 – 10 mins. the best and fastest water supply would be our pool, we have a septic system and the water pressure for the rest of the house isn’t great.. no fire hydrant.
so city limits is a big deal.
One of the major factors in homeowners rates is “fire protection code”. If you’re in a city, you have a public fire department within 5 miles of your house, likely. If your house catches on fire, the fire department can be there within minutes, and hook up to hydrants.
If you’re in the boonies, it might be 20 minutes before the volunteer fire guys get there, and the only water might be in the pumper truck. PLENTY of time for a house to burn to the ground.
That’s why they ask.
Rates are establish by Fire protection class. The closer you are to a Fire Department the better the risk and the rates. If you lived 20 miles from no where then it would take the nearest fire dept more time to respond. Your in town …so that gives you a better class for rating.