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New rating may mean a drop in homeowners' insurance rates for some, but not for others

In October, Tualatin Valley Fire & Rescue received an improved rating by the Insurance Services Offices (ISO), who helps to establish the industry standards used by most insurance companies to determine fire premiums. Insurance companies who utilize ISO to determine premiums are required to recognize the new ratings and the rating might just bring local homeowner's insurance premiums down a bit.GRAPHIC FILE PHOTO - Tualatin Valley Fire & Rescue received an improved rating by the Insurance Services Offices (ISO), who helps to establish the industry standards used by most insurance companies to determine fire premiums.

ISO uses a 10 point score with Class 1 being the best. TVF&R now is considered a Class 2 in all areas within five miles of a fire station. Previously, parts of the district without fire hydrants were considered a Class 8 or 10, with the rates higher than areas within the city. However, if the property is located five to seven miles from a fire station it is considered a Class 8 and properties located more than seven miles from a fire station are considered a Class 10w.

Before the new rating for TVF&R, "Newberg was already rated for protection as a Class 3. In the rural areas, outside of Newberg, the rate is much higher," said local Farmers Insurance agent Mike McBride.

"Based on the Federal Trade Commission rules, the date all insurance companies must recognize our improved ratings is (Thursday). Some carriers may pro-rate their discounts," said Cassandra Ulven, TVF&R public affairs chief.

Not all insurance companies recognize ISO ratings in their assessments for evaluating their rates. State Farm is one of the companies that do not use ISO ratings, so it is important that homeowners check with their insurance company.

"It's important that consumers understand ISO ratings are just one of many variables that are considered as part of the rate-setting process. The size of the residence, the age and condition of the property and roof, the type and quality of construction, etc., are some additional variables that also play an important role in determining rates," said Luis Sahagun, a spokesperson for Farmers Insurance. "Consumers should also recognize that any possible rate adjustments will be predicated on what their current ISO rating is, as these also may vary, depending on several local factors.  Finally, the timing of when those adjustments may occur will vary for existing customers since any pricing changes will likely coincide with their policy renewal date." 

TVF&R went through a rigorous assessment with ISO to determine its classification. ISO considered TVF&R's staffing, equipment, training, fire station distribution, incident reporting, data collection and community-risk-reduction efforts. They also evaluated water infrastructure, shuttling abilities and emergency communications.

ISO assesses even the smallest things: it looks at the type of training the firefighters receive, the number of ladder trucks and what kind of pumps that fire agencies have.

"They look at the whole system, they observe our fire stations and they observe our water shuttle operations and our ability to establish a water supply," Ulven said. "That is a particularly relevant point for the improved classification that we experienced. We could prove to the evaluators that even in the absence of a municipal water supply that we were able to get water to scenes. Anyone living across the street from the city limits was an (Class) 8. Now as long as they live within five miles of a fire station they are a (Class 2)."

"We are so pleased with our improved rating. It has the potential to save the people we serve money on their insurance premiums," said TVF&R Chief Mike Duyck. "We also appreciate the comprehensive analysis of our operations and prevention capabilities by an objective third party."

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