Feb 19

Pennies on the Dollar

Bad Deal

If I were to ask you this question, how would you answer:

How much money would you want from your insurance company if a fire burned up $70,000 of your personal property?

Although the answer seems like a no-brainier, without a key endorsement on your home insurance policy, you could be devastated by only receiving around $20,000 for your $70,000 of your stuff. How is this so?

Your Personal Properrty (Contents) coverage generally comes standard as Actual Cash Value, which means your stuff will be depreciated when the claim adjuster calculates the value of your personal belongings. Another way to consider this is to imagine how much you’d get for your personal belongings in an auction, garage sale, Craigslist,etc. In other words, you’ll only get a small percentage of what you’d need to replace any of it.

So, why would anyone do this? Most people wouldn’t knowingly make this choice. However, if you don’t know what to select, you could easily miss the Personal Property Replacemet Cost Endorsement that could cost you tens of thousnads of dollars. Another reason people don’t have this endorsement on their policy (and an increasingly common reason) is that some agents intentionally remove it to lower the premium to entice insurance shoppers who will unknowingly assume the agent was providing a comprehensive policy for their needs.

So, how do you know that you have this key endorsement? Although it’s easy to look for it on your policy documents, we’d strongly suggest having a well-respected, trustworthy agent that lives in your community review your policy with you. We’ve seen more and more quotes and policies missing this key coverage, and it will create a devastating situation for these homeowners if/when a claim occurs.

Comprehensive coverage doesn’t have to cost an arm and a leg, and agencies like ours can shop your policy to find the best rate for great coverage year after year as the insurance market changes.

Dont make this simple mistake and set yourself up for a financial disaster. Let us help you ensure you have the best option for your specific situation.