Municipal water leads to insurance savings in Eastham

Aug. 29--EASTHAM -- Homeowners will get a bonus from the new public water system and the fire hydrants that come with it, in the form of a discount on their home insurance bills.

The Insurance Services Office dropped the town's ISO rating from a 9 to a 4. The independent rating company has found that Eastham is better protected against fire damage since fire hydrants were installed.

Voters approved municipal water in 2014, and now hydrants are located within one mile of 85 percent of the properties, Town Administrator Jacqueline Beebe said.

ISO, the New Jersey-based company that rates towns for insurance companies, has noticed. The town was notified of the new rating on Thursday and it goes into effect in December, Beebe said.

But some insurance companies are already giving the credits, which average about 10 percent of the total premium, said Scott Kerry, owner of Kerry Insurance Agency in Eastham.

The Massachusetts FAIR Plan, which is one of the largest insurance companies used by Eastham residents, is waiting until Dec. 1, when the rating officially begins, he said.

The actual savings will depend on several factors, Kerry added. One of his FAIR Plan customers, who has a home replacement value of $475,000 (and a $1,000 deductible), will save $545, he said.

"We're extremely pleased," Beebe said.

The rating is based on a scale of 1 to 10 with 10 being the worst. The grading system looks at response time to fires, staffing and training of firefighters, and fire and telecommunication equipment. Quick access to water is a big plus, counting for about 40 percent of the grading system, Beebe said.

The savings will be good news for property owners who are now paying about $586 a year (for a home valued at $400,000) for the next 30 years for the municipal water system. In total, a property owner will pay nearly $18,000 for the system over the next three decades.

Installation of the water pipes is ongoing. So far 2,100 of the 6,000 properties in town can hook up to the water system if they want, Beebe said. Six hundred homeowners are actively using the system, she added. The rest of the streets will receive water access in the next five years.

Fire hydrants cover nearly all the properties in town already because they were part of the first phase of the water system. Most people are eligible for the rate reduction whether or not they have public water, she said.

-- Follow K.C. Myers @kcmyerscct.

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