Bruce Sackrison Insurance Issues: Your House Insurance: Are You Lined? – Napa Valley Register
Bruce Sackrison is a columnist for the Napa Valley Register who will write on property and casualty insurance matters.
J.L. Sousa / Register
Unfortunately, as individuals, most of us are generally unwilling to review our home insurance policies until a disastrous or catastrophic event occurs.
Given the magnitude of unexpected forest fires or earthquakes we experience in California, many of our customers have begun inquiring about the “what if” of their individual coverage.
When evaluating your specific home insurance coverage, it is important to understand some of the complicated details, also known as the fine print of your particular policy. You might think of your policy as the "steak," but the fine print is really the "hiss" that gets your attention.
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Do you understand the difference between the Actual Present Value Directive (ACV) and the Replacement Value Directive (RCV)?
What are Extended Replacement Costs or Guaranteed Replacement Costs and Why Do You Need Them?
Hopefully this helps:
Current monetary value (ACV) coverage is the cost, or market value, of the item (the physical structure of the house, not the dirt it sits on) minus the depreciation for the number of years you had at the time it was lost.
It's no secret that at today's prices, rebuilding a home tends to cost a little more than it did if you originally bought it, which is why mortgage lenders often ask for replacement cover for a mortgage home.