Monthly Archives: January 2014

Concept of UNDERINSURANCE and Reasons why you should not have an UNDERINSURED HOME INSURANCE for your valuable HOME or Property ?

The underinsurance occurs when the insured object is attributed a lower value than it actually has , and this situation can lead to very serious consequences especially in home insurance .

Therefore when it comes to hiring a home insurance policy you always have to provide complete information about our home: location, main features, security systems you have, if it is a regular home …

And above all we must make a real estimate of the value of reconstruction of housing to insure. For this we must take into account two major aspects: the continent and the content:

If considered content in Home:

The main construction : foundations and walls, forged, beams and pillars, walls, ceilings and floors, roofs and facades, doors and windows.
Accessory constructions : the dependencies that are in the same farm. The fences, walls and fences of the building insured.
Recreational and sports areas .
Fixed installations of: water, gas, electricity, heating and cooling. All of them permanently installed.
Content considered:

They are the specific goods of the home that are inside the house: appliances, electronic equipment, clothes and objects of personal use.
The value of content is established by the replacement value of those objects in case of loss, so an approximate calculation of the commercial value of all these items will have to be made.

It is also possible to insure valuables such as jewelry and works of art, but these would have to be included in the policy with more specialized coverages.

Thus, a priori it may be tempting to establish a lower housing value so that the resulting premium in the household policy is lower, BUT in the event of an accident, if there is an underinsurance, the indemnity would cover the declared value less the percentage of underinsurance, That is, the difference between the reconstruction value and the declared value.