Adequate Insurance to Value

Adequate Insurance to Value

by Art Glasgow, Peck-Glasgow Insurance

Most insureds do do understand the importance of proper insurance to value (ITV) until a loss occurs.

Adequate ITV for both commercial buildings and howmeowners does two things.  First it satisfies the basic coinsurance requirements of the policy. Second and most importantly, it ensures that policyholders are properly and completely covered at the time of a property loss.  This is true for homeowners insurance, dwelling fire insurance, commercial property insurance and specialty property insurance such as church insurance policies.  To make it simple, you must be insured to value in order to be fully compensated for a property loss.

Some policyholders in today’s marketplace want to reduce the limit of their building coverage.  They are not aware of the adverse outcomes that will occur at the time of loss.  If the building is not insured properly to satisfy the co-insurance requirement at the time of a loss, this can result in payment of loss that is significantly less than the actual cost of repairs. 

In order to prevent a short fall and make sure you are adequately insured, have your agent evaluate your property insurance limits every 2-3 years.  At Peck-Glasgow Insurance we are concerned about the small losses, however we do want you to have adequate coverage limits to rebuild your home or business in the event of a major property loss.  Good homeowner insurance or business owner insurance  placed by a professional insurance agent is a key in the event of a catostrophic property insurance loss.