Joshua Putnam wrote:
In article .com,
says...
Now here is the 2nd part of my
question. The reason i found a better deal that will save me about $300
is that my friend told me his insurance agent mentioned about insuring
the structure of the house is all that i need to do, not the house and
land. He said most insurance companies based the insurance on the land
and house when all i have to do is tell them that coverage is only
needed for structure of house. Anyone care to explain the details of
what exactly this meant? Thank you.
Homeowners insurance doesn't cover your land anyway -- land doesn't burn
down.
Exactly. ALL insurance companies look at the value of the structure
seperate from the land for precisely that reason. The house is what
they need to pay for if it is lost due to fire or storm. So, your
friend is full of baloney. But the insurance does cover the land
too, in the sense that if someone slips and falls out in your yard, or
a tree gets knocked down by a storm and damages your fence, etc. they
are covered. But those things are relatively minor in consideration
compared to the replacement cost of the house.
If you're getting 2 very different quotes, I'd make sure I understand
the differences in the policies, ie are both replacement cost based,
same deductibles, limits, etc and the companies track records before
going with either. I think you will find that is where the real
differences
And yes, if you cancel a policy, the remaining premium should be
refundable.
Your insurance covers your home. There are different ways of covering
the house -- cash value pays you a depreciated value, replacement cost
pays to rebuild the house. You can save money every year by buying less
insurance for your house, but that doesn't mean it's a good idea.
It's far more common for people to have too little insurance, not too
much. Your 2000 square foot home burns down and you only have enough
coverage to build a 1400 square foot replacement, or maybe enough to put
a nice double-wide on the lot.
You can also save money by under-insuring the contents of your house,
insure your personal property at cash value instead of replacement cost,
as long as you don't mind replacing everything out of thrift stores and
garage sales.
Now, it *is* possible your house is over-insured, it does happen. But
before accepting a lower insurance value, I'd want to be sure it's based
on a current, detailed replacement cost calculation using current
construction costs for your market.
--
is Joshua Putnam
http://www.phred.org/~josh/
Updated Bicycle Touring Books List:
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