IS YOUR HOME PROPERLY INSURED?
I have this discussion almost daily with clients, and real estate agents. Is your house underinsured? Most people tell me how much they paid to buy the house and want to insure it for that less the cost of the lot. However, for your home insurance purposes you should not use this figure as you could be at risk of the co-insurance clause penalty or underinsured.
What the what? Co-insurance penalty? If your home is not insured for the 100% full replacement cost, then the insurance company may not pay to fully replace the house! Many people in California found this out only after the big fires destroyed their home. The figures from California said that nearly 80% were underinsured! Out of that 80%, almost 60% were severely underinsured! This issue is not exclusive to California wildfire region.
I believe that a contributing factor to this is the ever increasing cost of insurance taking a bigger bite out of our personal budgets. People, and some agencies, reduce coverage's to save some money. But I ask you this, Does it really save you money in the long run? For the unfortunate homeowners in California affected by wildfires it doesn't.
The other related coverage is for "debris removal" and "ordinance of Law" that you need to research adding to your policy if you do not have it already. How much does it cost to have a demolition, haul off of the materials after loss? Ordinance of law coverage helps with the rebuilding at the new current codes. Again, in California wildfire losses homeowners found that new building codes easily added anywhere from 35%-50% to the cost of a home. Construction cost also increased by about 30%-35% after the disaster.
Hopefully this will entice you to re-evaluate your house coverage's. I would be happy to help you with this and see where we can get you the appropriate coverage at a budget friendly premium.
This week I quoted a homeowner, autos, and a rental home and was able to increase his coverage but reduce his premiums by about $600!
Please give me a call at 816-702-8300 to find out how we can help you!