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‘Enough’ Insurance is Often Not Enough

‘Enough’ Insurance is Often Not Enough

‘Enough’ Insurance is Often Not Enough
News from Huffington Post:

In the past few weeks, the most destructive wildfire in Colorado history claimed two lives, burned nearly 30 square miles and totally destroyed more than 350 homes. Like almost all homeowners everywhere in the United States, nearly everyone who lost their house to this massive disaster will have home insurance — but, at least three-quarters of those homeowners are about to learn (to their surprise) that they have far less insurance coverage than it will cost to rebuild their homes.

It happens every time. Across this entire nation, across all neighborhoods, classes, and communities, and despite homeowners routinely wanting to have and believing they have full insurance, about three-quarters of Americans are underinsured by tens of thousands — often hundreds of thousands — of dollars. There is a way for an individual homeowner to protect themselves, and a way for State Departments of Insurance to broadly solve the issue. Both depend on first understanding how the problem arises.

Insurance “values” homes for less than it costs to rebuild them. Many homeowners have at least a vague understanding of what their home is worth if the home was up for sale. Most homeowners have little understanding of what it would cost to build, or rebuild, the same home — usually a much higher figure. Homeowners typically buy insurance by goi…………… continues on Huffington Post

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