Homeonwers (Section I-Property) Question

Homeonwers (Section I-Property) Question

by Grisel Padron -
Number of replies: 1

Hi Jan,

I have a question regarding the above section on page 63 of the manual. It states the insured will have ACV but it can be adjusted to Replacement cost. In item (2) "to receive replacement cost, the insured must notify the company of intent to replace within 180 days". Within that same paragraph it states that Florida statute requires "when replacement cost is offered the carrier must pay the full replacement value without reservation or holdback of depreciation, regardless of whether or not the insured repairs or replaces the damaged property".

CONFUSING!!! I don't understand whether they actually have to repair replace or if they don't have to, and just simply notify the carrier within 180 days of their INTENT to repair or replace.

 Please clarify so I can understand this correctly.

 Thanks very much for your help.

In reply to Grisel Padron

Re: Homeonwers (Section I-Property) Question

by Jan Bradburn- -

This a condition in an HO policy that basically requires the
insured to maintain insurance equal to the value of the property – much like
the coinsurance clause.

As for your specific question – if the insured wants to receive
RC, they must verify that they are actually going to replace the damaged
property.  Many insured receive extra money to replace, but they do not
make the repairs.  This protects everyone with an insurable interest in
the property, i.e. lenders, etc.

Jan