"Oren" wrote in message
...
On Fri, 1 Apr 2011 12:27:29 -0700 (PDT), ransley
wrote:

stuff snipped

Short wiki: "Subrogation in its most common usage refers to
circumstances in which an insurance company tries to recoup expenses
for a claim it paid out when another party should have been
responsible for paying at least a portion of that claim."

There's a much, much worse word you can hear from your adjuster:
Coinsurance. I discovered that if you do not insure for the promised limit
of insurance your become a co-insurer when a loss occurs. You get to share
in the payout burden with the insurance company in paying part of the loss.
Policies typical require you insure to at least 90% of the property's value.

For example a $240,000 value at the time of loss multiplied by 80%
coinsurance (a factor of .80) equals $192,000.

$160,000 limits at the time of loss divided by 192,000, the limit required
(at the typical 90% coinsurance rate required in your contract) equals a
coinsurance penalty factor of .833.

$100,000 amount of loss multiplied by the .833 penalty factor equals $83,300

$83,300 minus the $2,000 deductible equals $81,300

The insurance company pays $81,300. You pay the remainder.

The math has most likely got an error in it, but anyone who's suffered a
loss in the last few years who hasn't substantially upgraded their policy
has likely run into this. It's very common in times of rapidly rising
housing values. "You know about coinsurance? were the first words out of my
adjustor's mouth *after* the fire. )-:

--
Bobby G.