Property Insurance

Property Insurance Information

With most property owners insurance policies your insurance company is responsible for paying the entire cost of repairing your home or business after you pay your deductible. Thus, your insurance company has a strong motivation to minimize their costs. Some insurance firms will go to great lengths to delay or deny claims or use other questionable tactics to save money.

Property insurance is an essential safeguard for protecting your home or business from unforeseen damages. However, the complexities of insurance claims can often be overwhelming. In this article, Adviser1 will guide you through key aspects of property insurance, including the pitfalls of obtaining multiple bids, understanding the differences between Actual Cash Value (ACV) and Replacement Cost Value (RCV), and how the condition of your property affects your insurance policy.

If the insurance company already knows the market value of fixing or replacing damage to your home or business, then why would they suggest, or in some cases insist, that you get multiple bids? It’s because the insurance company wants to manipulate you into either:

The Drawback of Multiple Bids

Insurance companies have deep pockets and they pay lobbyist a tremendous amount of money to influence government officials to protect their interests rather than the interest of home or business owners.

In either case, the price reduction benefit only goes to the insurance company. Your insurance company will only pay for what the contractor charges and will not pay you the difference.

1. Obtain a cheap bid from some “Chuck-In-A-Truck” that is willing to repair your home or business for less than what the insurance is paying.

2. Create a bidding war between the contractors so they lower their prices below market rates to win your business.

Furthermore, low estimates encourage contractors to cut corners. Any contractor that is willing to accept a below market payment must cut corners somewhere to survive. Unfortunately for you, this may be that the contractor is: using poor materials, or the required materials.