Is Your Home Underinsured?
Underinsurance is defined as the limit of insurance being insufficient to replace or fully repair damages caused by a covered peril, such as fire, wind, theft, etc.
I recently read a blog from Enhanced Insurance that I found extremely interesting and helpful, considering we deal with this subject on a daily basis. Here are a few key points:
- According to a 2008 survey by Marshall & Swift/Boeckh, 64% of U.S. homes were undervalued for insurance purposes.
- Of those 64%, the average homeowner had enough insurance to rebuild 81% of his/her dwelling.
- Market Value doesn’t necessarily equate to Replacement Cost. Remember, Market Value is what you can expect to sell your home for in today’s marketplace. Replacement Cost is what it would cost to rebuild or replace your home with “like kind and quality” materials.
- Different insurance policies offer different types of coverage: Replacement Cost (Limited, Extended and Unlimited) vs. Actual Cash Value
To the read the blog in its entirety, please click here.
It’s extremely important to have your insurance agent fully explain the coverage being offered and help you make the most informed choices about what is right for you. Contact me today for a comprehensive breakdown of your homeowners policy or for a side by side comparison quote!