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State Farm Insurance vs knob & tube wiring
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dpb
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State Farm Insurance vs knob & tube wiring
wrote:
wrote:
In article om,
says...
....
WELL THINK ABOUT THIS! $100,000 policy perhaps 500 bucks.
....
... how many 500 buck policies does it take to
cover the replacement or major repair cost of a single house fire?
....
probably 150 grand
....
Overall, a total loss of a $100,000 house could easily cost the insurer
$200,000 or more. ...
....
cover up K&T by saying you dont have it or disquising it by say getting
it out of basement? have fire they likely deny the claim....
OK, assume $200k/loss. It would take 400 policy premiums to make up
the direct loss. Assuming the ancillary costs are 100% of that would
still be under 1000 paid premiums _per annum_ to make up for the
one-time infrequent loss. I don't have data at hand, but I'd venture
the percentage of US homes having a full loss annually is far less than
one in a thousand. (Only to point out things may not be so bleak for
the underwriters as you seem to be trying to make us think...
)
Where homeowners' underwriters tend to have problems is not in
individual home policies but in areas prone to widespread disasters
such as flood, hurricane, earthquake, etc., where a whole region gets
hammered at one time. Unfortunately, as they were reminded in the Gulf
and FL the last few years, one can not apply the individual recurrence
interval per household in a region independently for common-cause
events and remain actuarially (sp?) sound over the long haul.
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