Posted On: June 21, 2005, 10:38 am CDT

Posted By: Roger Poe

When consumers find out that A LOT of insurers-insurance agents have used / are using Replacement-Reconstruction Cost Values for calculating homeowners policy's, and then (unbeknown to customers and some adjusters), are using NEW construction cost values to "settle"-"close" (wind, flood, hail, hurricane, moisture, etc.) homeowner claims, other shock waves will ripple.

New Construction costs are commonly 35-50% lower that Replacement-Reconstruction costs.

http://financialservices.house.gov/media/pdf/041405sk.pdf

Also, leaving out other prefactored premium costs-to-claim loss values (Primary-General-Sub Contractors overhead and profit dollars) can underpay a homeowners claim loss value by an additional 20-49%, and is unfair to insureds.

http://www.tdi.state.tx.us/commish/bulletins/b-0045-8.html

Utilize either or both of the two claim underpayment protocols to daily, or tens of thousands of catastrophe claims loss values, and the following can happen;

http://www.insurancejournal.com/news/east/2005/06/09/55854.htm

Roger Poe
Reconstruction Specialist
insuranceclaimsandsettlements@hotmail.com