Letter Re: Lessons Learned

This article is not be representative of many insurance policies. I am a insurance agent. First, I am sorry they had to go through such a horrible tragedy. People need to remember insurance policies vary from state to state and policy to policy. For the policies that I manage, these are the issues that are different:

  • First auto policies are not replacement cost. They are blue book value (aka NADA), less your deductible. You could very well end up upside down, meaning you could still be paying payments on a destroyed vehicle, where you owe more than it’s worth.
  • The bank usually doesn’t force you to rebuild the home. They just want their “interest of the home” paid back.
  • Some insurance policies do cover trees and shrubs up to $250, depending on the company and type of homeowners policy.
  • You can also insure your personal property for replacement costs, just as you did the structure, which we recommend, so that you do not have to worry about depreciation. Still, some people choose not to purchase replacement cost insurance. You would be surprised.
  • If there is a total loss, some companies will not make you make a list. They usually will pay policy limits, unless there is a need to for suspicious activity or some other reason.
  • The percentages for the depreciated items seems to be off. It depends on how old the items are. So to compare from one person to the next would be comparing apples and oranges.
  • Some policies have built-in limits for guns, gold, art, etc. If you need more coverages, you have to let your agent know to endorse the policy accordingly.

Always read your policy and question your agent! Make sure you know what coverages you have or don’t have.

I am sorry this happened to this individual. I agree; be more fire safety alert, and never use “Plug Ins”. (I’m not saying this person did at all.) I have been to several insurance safety classes and discovered that those things have caused lots of fires! It takes 2-3 minutes sometimes for a fire to engulf a home– scary stuff. We have the little one’s alert, too!