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 Posted: Fri Dec 19, 2008 7:28 pm Post subject: Mobile home policy with Foremost - total fire loss question |
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Hi, this q is mainly regarding the optional replacement cost coverage with Foremost. They pay new cost to replace items and the dwelling with this option, but also there's a confusing bit about coverage up to 120% of the insured amount on their website:
"With this optional coverage you can receive up to 120% of the insured amount, if needed, to replace your home."
Question is, I found out that optional repl for the dwelling and personal property are separate. I only have repl cost for personal property, which was insured for a low amount. PP totals came over 3x the insured amount, unfortunately, and I wanted to see if anyone is familiar with the details, if 120% of the personal property limit could be covered. My adjuster says this only applies for dwelling repl coverage.
No complaints about the insurance, as they've come thru in a couple of months. A lot of the money lost on personal property is made up with the dwelling coverage, so it should even out alright.
Thanks!
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MikeSE
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| Posted: Sat Dec 20, 2008 6:26 am Post subject: |
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I think the policy paper is the best document to refer regarding clearing up the confusion. The policy document must have detailed out the coverage level applies to each item.
The individual policies may vary. Also the coverage available may vary with the states, not all coverage available at every state. However, in a standard homeowners policy the replacement cost coverage suggests that the insurance company will cover the expenses to replace the covered items at the current market cost, without restricting the loss volume to the policy limit. |
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simon
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| Posted: Sat Dec 20, 2008 7:21 am Post subject: |
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Please explain the following part
| Quote: | | PP totals came over 3x the insured amount, unfortunately, |
As far I understand the property value depreciates with time and use and therefore, may not cost the same in today's time. On the other hand, the prices of the construction materials have gone-up, hence it may cost more to replace a home at the current market price. The insurers, therefore, have put the clause to extend the coverage limit beyond the agreed level. This form of coverage is known as the extended replacement cost coverage.
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Taibuhonda
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| Posted: Sat Dec 20, 2008 8:20 am Post subject: |
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Damaged personal items came out to over 3x the insured amount for personal property, however I had extended replacement cost coverage. Only their website mentions up to 120% of the insured amount with optional repl cost coverage for the dwelling.
They said the max for personal items was the policy limit for personal items, regardless of extended replacement cost coverage for those. Only they would consider new value instead of depreciated value.
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MikeSE
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| Posted: Sat Dec 20, 2008 8:23 am Post subject: |
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Oh yeah, I also couldn't find any mention of this extended 120% repl cost coverage in the policy booklet. The whole thing seems rather vague.
Thanks for the help and sorry about the double post.
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MikeSE
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| Posted: Sat Dec 20, 2008 8:51 am Post subject: |
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Okay, so re-reading the policy document actually solved the problem. Now, the following is for the information sake...
The replacement coverage on the personal property will replace the damaged items with products of same quality and nature, irrespective of what it might cost. Normally, the insurer requires the homeowner to cover the contents upto 80% of the full-replacement value of the house.
Hope it was helpful.
~Jeremy |
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JeremyHolter
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| Posted: Sun Dec 21, 2008 12:24 am Post subject: |
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Thanks, I'm actually still unsure about the whole personal property payment. Just took the adjuster's word for it and cashed the check, which was maxed at the insured amount.
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MikeSE
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| Posted: Mon Dec 22, 2008 11:10 am Post subject: |
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The personal property replacement coverage enables the policy holder to receive replacement for his damaged property. Unlike the actual cash value policy , which will pay only the value of the item when it was insured minus the wear and tear through the years of use, the replacement coverage will compensate you for the article of exact nature and quality.
Let state with an example, suppose you have brought the color TV back in 2003 and have insured it for the acv. Now, you will receive only the amount insured minus the depreciation for all these five years of use. The insurer will determine what that TV will cost at the present market condition to determine the actual cash value. With the replacement value coverage, the old one will simply be replaced with a new one and no amount will be deducted owing to the depreciation from use. |
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jeorge
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| Posted: Sun Jul 05, 2009 12:37 am Post subject: total fire loss |
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My house burned down, total loss. I have replacement cost of pers property, with $12,000 but the actual amount was $30,000. Do they only have to pay the $12,000. My insurance covers just the home but my loan also included land so loan is $40,000 more than insurance. What does the mortgage company do at this point? thanks
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foxglove
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| Posted: Mon Jul 06, 2009 9:10 am Post subject: |
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Hello Foxglove,
| Quote: | | I have replacement cost of pers property, with $12,000 but the actual amount was $30,000. |
How it could be? Does that mean that you were underinsured?
Most likely the insurer would pay only upto the policy limit.
| Quote: | | My insurance covers just the home but my loan also included land so loan is $40,000 more than insurance. |
Has the land sustained any damage? |
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simon
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| Posted: Mon Jul 06, 2009 12:00 pm Post subject: |
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| Quote: | | My house burned down, total loss. I have replacement cost of pers property, with $12,000 but the actual amount was $30,000. Do they only have to pay the $12,000. |
Yes, they can only pay up to your policy limit... | Quote: | | My insurance covers just the home but my loan also included land so loan is $40,000 more than insurance. What does the mortgage company do at this point? thanks |
They will pay your limit to the mortgage company..You will still have that balance
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Lori
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| Posted: Thu Aug 27, 2009 1:46 am Post subject: Foremost |
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Actually what they do is depreciate your personal property, then you have to spend the money to recover the rest.
EXP: Personal Property 45,000
Minus Depreciation 16,000
Minus Deductible 500
Minus Check the adjuster gave you after fire (3,000)
You Get 24,000 for Personal Property
This with replacement cost insurance
So you have to spend 19, 500 of your money
read the policy real close
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Kaylee
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heidrek
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