How do you determine how much to insure your home for??

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  #1  
Old 08-19-2007, 12:04 PM
784caroline 784caroline is offline
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Default How do you determine how much to insure your home for??

For Home insurance purposes how do you determine the value of how much dwelling insurance you should carry?? 1) Purchase price, 2) Purchase price minus land value, 3)total Square footage which include Areas under heat/ac plus garage, 4) Only square footage under heat/ac and garage is additional structure, or 5)let the insurance company arrive at a "replacement cost" for you to insure????
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Old 08-19-2007, 12:27 PM
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villages07 villages07 is offline
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Default Re: How do you determine how much to insure your home for??

My insurance company initially did purchase price - land value (which should equal cost to rebuild the house); on my one year anniversary, they increased this dwelling replacement coverage by 10% and said they factored in price changes in labor and materials. As someone else mentioned in another post, I guess you should notify your insurance company of any major additions or renovations so that they can be factored in and be sure they are covered.

On a related, side note....those of you with Travellers through the Villages Insurance... if you've gotten a renewal lately with a hefty increase (mine was 50%), make sure you check out the windstorm mitigation inspection you can have done. In my case, it not only eliminated the 50% increase, but also decreased my premiums by 20% over what they were a year ago. It's mentioned in the renewal notice but not very clearly or strongly to spur people to action. The inspection costs between $60-$100 and there is also a program through the state where you can have it done for free. It's well worth it for Travellers. Supposedly, ASI builds these protection factors into their premiums, but, wouldn't hurt to ask your agent if inspection would be worthwhile.
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  #3  
Old 08-21-2007, 01:00 AM
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Default The First Year Is Easy...

...particularly if you use The Villages Insurance Agency as your agent. Being owned by TV, they have your plans and sales contract right on their computer. So they take the value of your house, not including land or lot premium, talk to you about your desired deductibles, and calculate a premium.

Where it gets dicey is the second and subsequent years. If you sign up for "replacement cost insurance", the insurer will increase the insured value by a fixed percentage each year. The percentage increase is supposed to represent the increase in construction costs from year-to-year. In my case the insurance company applied an 8% inflator. Someone above said Travelers jacked their replacement costs by 10%. I couldn't imagine that construction costs in TV, or anywhere else in the U.S., have increased by that amount in the last year.

When I got my renewal bill, the combination of increased replacement value and premium increase resulted in a renewal premium increase of about 22%. So before sending a check, I did a little shopping around. Much to my surprise, the same insurance company quoted a much lower rate on my house--not too much more than what I paid in year one for the same coverages--thru a different agent. I answered all the questions regarding size and construction and while the premium was a bit higher than my first year, it was no where near 22%.

When I pointed out my findings to my agent at TV Insurance Agency, she spent several hours jumping thru hoops to get the rate I had been quoted from my insurance company. In the process she found there had been coverage exclusions for wind damage to bird cages that had been made by the insurer. At the end of the day, the agent at The Villages Insurance Agency got me the same coverages as I had last year, plus coverage for wind damage to our bird cage, for only a little more than the premium I paid last year.

I can't be more complimentary of the agent from The Villages Insurance Agency. But when you get your renewal bill for next year's premium, don't just assume that it has to be paid without doing a little research. There's some real money to be saved--particularly if you have an agent willing to go a little bit out of the way in your behalf.
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Old 08-21-2007, 03:07 PM
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Default Re: How do you determine how much to insure your home for??

A LITTLE FOOD FOR THOUGHT..

I would guess that the majority of homes in The Villages are insured by THE VILLAGES. In a case of a major disaster where thousands of homes are damaged, will they be able to service the policy holders?

Any thoughts from the Tornado victims?
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