Monday, August 21, 2006

Tip of the Day: Homeowners’ Insurance

Watch out on your homeowners policy

After all the post-Katrina publicity, most people know that homeowners insurance may not cover flooding expenses but there are other gaps in insurance coverage worth noting. New Jersey residents might want to check their policies and make adjustments. Most important is replacement costs as opposed to actual depreciative value. Replacement insurance is more expensive than the cost of actual depreciative value which is the standard coverage. Replacement insurance is meant to replace the item rather than a company assigned depreciative value. Oftentimes there is a cap placed on the replacement costs. If there is a cap make sure it is set at 150% to 200%. The article is worth a read for homeowners.



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