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 Posted: Sat Nov 01, 2008 2:17 pm Post subject: How does my home value |
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How does my home value appreciate but according to my insurance company the roof is depreciating even though I have full replacement coverage?
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| Posted: Sat Nov 01, 2008 2:58 pm Post subject: |
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| Two different things. Your insurance company is not saying your roof is appreciating... they are stating that as time goes on it will cost more to _replace_... and this is what the insurance policy will address, the cost to replace. |
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tcope
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| Posted: Sat Nov 01, 2008 7:16 pm Post subject: |
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When looking at your HO policy, remember that the "price" of your home on the policy isn't what you could get if you sold it (it might not even be close).
The "price" on the policy is what it would cost to rebuild if something happened to it. Insurance is there to put you back to a place before the "incident."
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LifeIsGood
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| Posted: Sat Nov 01, 2008 9:07 pm Post subject: |
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This is how it was splained to me.
As a home appreciates in value, it is the sum of all it's construction components. It includes the desire of multiple prospective buyers wanting to buy in your area because of schools, job availability, and other factors including homeowners that maintain their property with upkeep.
The cost to replace your home increases as construction products, labor, hvac, roofing increase proportionally. You may very well be over insured for the value of your home in the event of a total loss and you choose not to replace. You are purchasing a policy that guarantees that your home will be repaired or replaced in the event of a partial or total loss. If you elect to accept the actual cash value of the loss, it will most likely be less than the cost to replace.
You may choose to insure your house or property with a policy that is not replacement type coverage. If you insure a dwelling or property worth 100,000 with only 50,000 coverage and it is a total loss, you only insured that property for fifty percent of the value and you would be only entitled to fifty percent of the 50,000 coverage which is 25,000 less any deductible.
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Dewey, Cheatum, & How
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| Posted: Sat Nov 01, 2008 10:10 pm Post subject: |
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(mike is that you?  )
I talked with my own carrier just last year about this because I think it's getting out of control as well the appreciation every year on my policy and IMO I should be able to say, enough already! if it's atleast as much as I owe...my house in the past 8 or 9 years is insured for about twice what I paid for it...I understand the whole rebuild it thing...but seriously when will it stop? never....and as they told me no I cannot stop or reduce this annual increase in 'protection'.
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Lori
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| Posted: Sun Nov 02, 2008 5:48 pm Post subject: |
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| When I have a HO policy with State Farm, they did the same thing... increased the limits of the policy (and my premium) every year. They told me this is what people wanted. My bottom line, _I_ should be able to choose what limits I want to buy. They told me that I could not remove that auto adjust feature but I could call each and every year and reduce the limits. Basically it's a way for the insurance company to make a quick easy buck. The chances of having a total loss are next to nill and I'm not going to loose the land to anything. I can see where it should be an option and that the agents should push hard to sell it, but until a customer is allowed to remove it, it's just a scam to make money. |
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tcope
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| Posted: Mon Nov 03, 2008 9:09 am Post subject: |
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What about when the price of the property falls? Would the insurance company lower the coverage level as well as the premium as auto adjustment? I would go with Tcope, it's a well planned and legalized scam by the homeowner insurance companies to earn quick bucks.
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sabre-tooth
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| Posted: Mon Nov 03, 2008 11:01 am Post subject: |
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I'll try reducing the limits, my agent thinks it's crap too she didn't mention this, but maybe she doesn't know and maybe it's not possible..ho premiums have skyrocketed in my neck of the woods the past oh six,seven years...i think i pay over a thousand a year so any reduction is good...it really ticks me off and i agree it's a built in legal scam..
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Lori
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| Posted: Mon Nov 03, 2008 11:14 am Post subject: |
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| I never even knew that auto adjust feature was in a policy. I too have seen my cost of coverage go up and now I understand why. Something else I asked my insurance agent about when trying to figure out why it increased (before last years mishap) Is they had coverage for outside builindgs in the amount of $8000. I told them I didn't have any outside buildings. They told me it was a mandatory coverage and it had to be put on my policy regardless. Is this one of the examples you are talking about? Or is this a whole other scam? |
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fireyone
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| Posted: Mon Nov 03, 2008 11:45 am Post subject: |
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Well fire that's really not a scam...all ho policys are basically the same as far as this goes, for instance dwelling is insured for 100k, automatically any out buildings are 10k, contents 50k, and so on...unless it's a case where you need to add coverage there is a percentage forumala for these coverages, however, I agree with you in that if you have no out buildings you should be able to wave that coverage thus saving some premium...just an fyi, as long as i've been around insurance it has been this way (re out buildings etc)...just the way the policys are written.
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Lori
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