Posted On: March 28, 2007, 10:40 am CDT

Posted By: adjusterjoe

Linda:

You show your lack of knowledge. However, you finally have now learned there is no CO-INSURANCE in a HO policy. Just relax and think. If you can buy whatever amount you want without regard to value, you could buy $50,000 on a $200,000 dwelling. This would result in a loss of premium of over 50% top the carrier. As over 90% of all losses are partial, not total, you would be getting the benefit of insurance without payimg premium for it.

Now to address the CO-0INSURANCE VS REPLACEMENT COST CLAUSE. Co-insurance penalizes the insured much more severely than the RC clause. In the event of underinusrance on a CO-INSURANCE contract, the insured sustains BOTH depreciation and a penalty based upon the underinsured percentage. Such as if $80,000 was required, and $60,000 is the policy amount, the insured would first sustain depreciation and then would have an additional 25% deducted. In a replacement cost clause loss with the same figures, the insured would sustain a loss of actual depreciation or the penalty of 25%, whichever is LESS!!!!

Finally, how can you afford to pay for a $300 real estate appraisal on every policy. And an appraisal does not calculate RC, it calculates market value. These are two entirely different values.

No, Linda, you should learn about the insurance industry before you make such statemnt to show your lack of knowlege and understanding.