Twelve Important Insurance Questions for Florida Homeowners [Part II]

J.P. Gonzalez-Sirgo
Founder of J.P. Gonzalez-Sirgo, P.A.

This is the second installment of our two-part blog that provides important answers to twelve common questions posed by homeowners about their insurance coverage.  If you have questions about your specific situation, I invite you to call and speak to me about your homeowner insurance claim issue.  As a former claims adjuster, I have extensive experience in obtaining prompt resolution of insurance claims.

What types of damage should I assume that my homeowners policy will not cover?

The specific perils and types of damage covered by your policy will depend on the coverage you purchase.  As a general rule, a standard homeowners policy will not cover intentional damage, damage from war, ordinary wear and tear, flooding or earthquake.  Policies often exclude other types of perils, so you should carefully review your entire policy and ask questions of your agent or an insurance claims attorney if you have questions about coverage.

Is there any reason to consider updating my policy if I have not reviewed my coverage for many years?

In this situation, you should carefully review your entire policy to identify potential shortcomings in terms of your coverage.  There may be endorsements providing additional forms of coverage that did not make sense when you purchased the policy that make sense now.  Further, the limits of your policy might be set too low given the replacement value of your home if you have a policy that has not been updated in many years.

Do I have to submit to an inspection of my home by the insurance company?

The insurance company has an opportunity to conduct an inspection of your home for purposes of assessing potential loss and to assess the value of the home.  The inspector may issue recommendations regarding changes or repairs that need to be undertaken to reduce the risk of loss.  If a homeowner does not implement these recommendation, the insurance company might use this as a basis to cancel the policy.

Why is replacement coverage for the personal property important?

If you do not have replacement coverage, the insurer will pay you the purchase price of the item but only after subtracting an amount for depreciation.  If a significant amount of your property is badly damaged or destroyed by a fire, for example, you might struggle to replace your home furnishings and other personal property because you lack the funds to actually replace the items.  If you have replacement cost coverage, you are entitled to the amount needed to replace destroyed, stolen or damaged personal property without regard to depreciation.

How come my insurance company failed to return my entire premium after my homeowners insurance policy was cancelled?

Many policies impose financial penalties for early termination of coverage, so it is important to ask about this issue when evaluating potential policies.  Some policies provide that the premium is fully earned upon issuance of the policy or that you must make a minimum premium payment even if you cancel early.  When you switch insurers during your term, many insurance carriers charge a “short term” fee.

How does a policy that provides “actual cash value” differ from a policy that provides “replacement value”?

Replacement value is more generous for the homeowner because it entitles the policyholder to the value to replace the home or personal property based on current prices.  By contrast, actual cash value essentially amounts to replacement value less the cost of depreciation.

What does coverage for additional living expenses (ALE) provide?

Many times when a home is severely damaged, the homeowner is forced to relocate while the home is being repaired or rebuilt.  Homeowners forced into such a mandatory relocation may incur costs for lodging at a hotel, additional gas for commuting and extra dining costs from eating out, these extra living costs can be covered by ALE coverage.

If your residence is damaged by fire, windstorm or theft, your homeowners insurance carrier has a legal obligation to treat you fairly in adjusting and paying your claim.  Homeowners who are forced to endure unjustified delays, denials or lowball offers might have a right to bring a claim for breach of contract and/or insurance bad faith.  My law firm represents policyholders in claims disputes in Miami and throughout Florida.  The Law Firm of J.P. Gonzalez-Sirgo, P.A. offers free consultations and case evaluations.  No Recovery, No Lawyer Fees.  Call 305-461-1095 or Toll Free 1-866-71-CLAIM.

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