Homeowners Insurance/Replacement Cost

[ultrarunner]

we had tornados in my area on april 27 of last yr. People had their homes insured for replacement cost when they took out the H O policy years ago. No one from the insurance companies ever came back to re adjust for cost increases ie: building materials, cost per sq to re build, etc,. When the tornados wiped out these homes, the home owners didn't have enough insurance coverage to rebuild their homes & were stuck for the cost over what insurance paid.I recently went with another insurance company for my H O & vehicles. I asked if I could just insure my home (with no mortage) for xxx$ and in the event the house was destroyed by fire, tornado , etc, just collect a check for that amount. (like a life insurance policy) They told me that all they sell now is replacment coverage. I called several other companies & they told me the same thing. ''All we sell is replacment coverage''

Good luck

Same deal with the Oakland Hills Fire Storm... thousands of home owners banded together and did get replacement with replacement insurance... it was a huge story with constant updates and the industry took a beating till they acquiesced.

Now, every year with my renewals, I have a form that states the replacement value and I need to contact them if I disagree.

 

[blueriver]

Same deal with the Oakland Hills Fire Storm... thousands of home owners banded together and did get replacement with replacement insurance... it was a huge story with constant updates and the industry took a beating till they acquiesced.

Now, every year with my renewals, I have a form that states the replacement value and I need to contact them if I disagree.

Understood ... BUT ... should it not be my right to decide for myself how much coverage I want ??? In the event of a loss they pay only so much and I get something ... maybe not replacement BUT I just might buy a Mobile Home and live happily ever after.

 

[ultrarunner]

Understood ... BUT ... should it not be my right to decide for myself how much coverage I want ??? In the event of a loss they pay only so much and I get something ... maybe not replacement BUT I just might buy a Mobile Home and live happily ever after.

Well... you have to remember you are dealing with an Insurance Company and they see things differently...

Most policy holders take a substantial reduction in payout if the property is not rebuilt... guess it cuts down on fraud because what's the incentive if you can't just take the money?

Another favorite is being underinsured... so you have 50k insurance on a 100k dwelling and suffer a 50k loss... logic would say all is good...

But, your dealing with insurance thinking so it is far from good... the adjuster rolls up and says you were 50% insured so we will cover your 50k loss at 50% and cut you a check for 25k minus you 1k deductible only IF you rebuild... if you don't we will knock down that figure another 20%.