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Q: We have just bought a house. The agent who sold it to us is trying to push us toward a particular insurance agent for homeowner’s coverage, and I’m a bit suspicious of this. What is your advice?
Another thing to remember, which is a big thing in the homeowners insurance realm these days is "replacement cost" insurance. A lot of companies don't offer it anymore.
Example:
Person A purchases a $100K house, and replacement cost insurance.
Person B purchases an identical house at the same time with $100K insurance with a 25% increase bonus.
10 years go by. The homes increase in value to $175K. Both houses burn down.
Person A has replacement value insurance, and the insurance company has to pay to have the house replaced, which is $175K.
Person B has a $100K policy with a 25% bonus, so gets a check for $125K.
Person B is our $50K.
This is a big issue in the insurance industry.
My wife and I checked our insurance policy and were told that we DID HAVE replacement cost insurance, however that the company did not offer them anymore.
BTW: This information example was taken from Dave Ramsey's FPU Lesson: Understanding Insurance. http://www.daveramsey.com
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Another thing to remember, which is a big thing in the homeowners insurance realm these days is "replacement cost" insurance. A lot of companies don't offer it anymore.
Example:
Person A purchases a $100K house, and replacement cost insurance.
Person B purchases an identical house at the same time with $100K insurance with a 25% increase bonus.
10 years go by. The homes increase in value to $175K. Both houses burn down.
Person A has replacement value insurance, and the insurance company has to pay to have the house replaced, which is $175K.
Person B has a $100K policy with a 25% bonus, so gets a check for $125K.
Person B is our $50K.
This is a big issue in the insurance industry.
My wife and I checked our insurance policy and were told that we DID HAVE replacement cost insurance, however that the company did not offer them anymore.
BTW: This information example was taken from Dave Ramsey's FPU Lesson: Understanding Insurance. http://www.daveramsey.com
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