The housing market has been insane.
Median existing home sale prices rose 14.6% in 2021, and 20% from March 2021 through March, 2022. Prices are expected to continue to rise in 2022 at a slower rate as mortgage rates go up.
Is your home underinsured?
What does this all mean for you?
Now is the time to contact your agent or broker.
Many insurers have increased their rates based upon the growing housing market. However, this doesn’t mean your home is completely covered.
If your house is underinsured and you experience severe property damage or devastation due to a fire, a weather event, theft, flood, leak, mold or a catastrophic event, your insurance may not cover a complete rebuild or even a partial renovation.
Think about this.
Not only has the price of your home increased. Building supplies are scarce. The price of lumber and other construction costs are up significantly, and there’s a supply chain issue with getting materials.
Investopia defines coinsurance as the homeowner policy’s formula that determines the amount of reimbursement that a homeowner will receive from a claim. The coinsurance formula in a replacement cost policy becomes effective when a homeowner fails to maintain coverage of at least 80% of the home’s replacement value. Those who are in this situation who file a claim could only receive partial reimbursement according to the formula.
Coinsurance is another reason why homeowners should revisit their policy sooner than later.
The bottom line.
Take the call from your agent when they want to talk to you about a policy review.
It may make sense to increase your coverage. This will give you the assurance you need that you don’t fall into the trap of being underinsured. And, if there is a major disaster where you need to file a claim, you’ll be able to get full replacement value where it’s warranted.
That’s the idea behind having insurance. To make sure you are covered, if and when the unknown occurs and destroys your property.
About Clarke & Cohen Public Adjusters:
Clarke & Cohen Public Adjusters and Loss Assessors are licensed, highly experienced professionals who manage every aspect of your residential claim services.
We service Bala Cynwyd, PA, and the surrounding areas including Philadelphia, Montgomery, Bucks, Chester, Delaware Counties, New Jersey, including the Jersey shore, and areas throughout the United States.