Bill Quickel's - Insurance Plus Agencies Inc. Blog |
 Most of the time, homeowner's insurance pays to repair or rebuild a damaged home so its owners can continue to live there as they did before the loss occurred. Sometimes, though, you may prefer to take the insurance money and move somewhere else instead of rebuilding. Several factors determine whether this is possible and how much money you receive. Mortgage
If you have a mortgage on your home, you are not the only owner. Your homeowner's insurance company must represent all the owners, including the lender, on settlement checks. You will not be able to cash any check with the lender's name on it unless the lender endorses it, which is unlikely. The lender has invested money in your home and wants to ensure it is repaired so its investment is secure. Total Loss If your home is destroyed and the settlement amount you receive from your insurer exceeds the outstanding balance on the mortgage, you may be able to sign the check over to your lender to pay the balance due. If there is any settlement money left after satisfying the mortgage, the lender will issue you another check for your portion. Some lenders may not do this; they may insist on rebuilding the home. You must do what the lender demands. No Mortgage If you own your home without a mortgage, the settlement money is entirely yours. You may want to repair partial losses to your home to keep it safe and functional and retain its value, but if you prefer to take the money after a total loss instead of rebuilding, you can. Your local government may insist (Ohio Revised Code) you clean the debris from your old home off your parcel, but otherwise you can take the money and run, so to speak. Actual Cash Value If you choose not to rebuild your home, you may receive a smaller settlement amount than if you were to rebuild. Homeowner's insurance is settled as actual cash value, meaning settlements are diminished according to depreciation, unless you have a replacement cost endorsement. However, many insurers don't pay replacement cost unless you actually replace the damaged property. Therefore, if you choose not to rebuild your home, you may only get an actual cash value settlement. By Stephen Hicks, eHow contributor In simple terms - Your insurance company is trying to protect you and other insureds by safeguarding losses. Intentional fires or claims could drive up premiums. For More information on Protecting your home contact Bill Quickel's - Insurance Plus Agencies Inc. 740-992-6677 114 Court St. Pomeroy, Ohio 45769
23 Comments
Nancy Burns
4/3/2019 09:50:47 am
Hi! Your no mortgage statement and actual cash value confuses me. It's me not you! My house burned down. I have received my insurance settlement. May I sell the lot and keep what I have received? Or as in your actual cash value phrase would I need to return some of the settlement monies back to the insurer? I do not know what an actual cash endorsement is. I do realize I would forfeit the 20% additional I might receive in the policy to bring my new home to like kind standard. Thank you!!
W
9/28/2020 12:48:29 pm
You can sell the lot, your policy 99% of the time does not cover the land the home sits on, only the structure itself. 8/9/2019 09:59:36 am
That's a good point that if a home is owned through a mortgage, so the lender will require repairs for the home to remain a secure investment. My brother is about to buy his first house. He'll have to find a good homeowner's insurance plan so he can protect his new home. 1/7/2020 01:06:39 pm
Very informative and helpful post, thanks for sharing and keep up the amazing work.
Jenny Smith
1/27/2020 08:01:26 pm
My house burnt 2 years ago the 27th I have replacement cost and I moved a double wide on my lot. My insurance made me make a list of my personal property I could not remember what all was in my house I'm 74 and lived there over 50 years. Now they tell me my case is closed because it's been 2 years. Can they do that?
W
9/28/2020 12:50:29 pm
Yes, if they gave you 2 years, that is likely the timeframe detailed in your policy. 2 years is pretty standard.
Donna Flores
5/17/2020 09:34:08 am
My neighbor in front of me had their house burn out completely 2 months ago.The mess is around yard and has not been mowed at all the grass is almost a foot high..what can I do to have them clean up.
W
9/28/2020 12:54:33 pm
The city or local ordnance is the only recourse you have. The policy has nothing to do with it what does or does not get done. That is up to the homeowner.
Good neighbor
11/9/2022 08:05:14 am
Maybe ask if they need help? Offer to loan your tools and a helping hand . As someone who just lost my home and all of my belongings including my car keys and my cats, I'm in a hotel with two dogs no way to get back and forth and if my neighbors complained about my yard while I waited for contractors and insurance settlements paying more money than I had in hotel fees wondering where I'm going to go next and have to give up my only babies left, I would hope my neighbors would pitch in and do it for me so it's one less thing I had to worry about instead of reporting them to city and getting fined and they will clean it and bill triple as well. Be a good neighbor. Lend a hand . 6/19/2020 11:23:35 am
Thank you for explaining that you must do what the lenders say. If they want you to knock down the house and rebuild it then you have to do that. I hope that more people come to realize this so they can plan ahead for what their lenders may want them to do.
Jai
9/18/2020 08:28:29 am
I lost my house to a fire and I chose to relocate, I was told to seek my old house but not having any luck. My question is will my insurance company pay to demolish my house or do I have to pay for that with the money they gave me to buy a new house?
W
9/28/2020 12:52:34 pm
Most policies, but not all include an additional percentage for debris removal. Yes you will have to pay for the demo out of the combination of those two limits. 3/16/2021 04:42:45 am
This article is full of information ,What is wage loss insurance for a person when someone injured in an accident due to other person’s negligence? Well, it's hard to understand without consequence. Let’s see how the process work for an injured person or his family. I have also found an article anyone can check for more information. <a href = https://injurylawyerofcalgary.com/what-is-wage-loss-insurance/ "> Wage Loss Insurance </a> 3/16/2021 04:43:53 am
This article is full of information, What is wage loss insurance for a person when someone injured in an accident due to other person’s negligence? Well, it's hard to understand without consequence. Let’s see how the process work for an injured person or his family. I have also found an article anyone can check for more information. <a href = https://injurylawyerofcalgary.com/what-is-wage-loss-insurance/ "> Wage Loss Insurance </a> 3/23/2021 12:32:00 am
Thank's, It's a great thing that this article suggested the importance of Do I Have To Rebuild For My Insurance To Pay?
t s
9/8/2021 02:59:58 pm
Interesting but what is Cash Value minus depreciation ? The amount I paid minus a yearly depreciation or the amount the house would sell for in today's market ? 9/9/2021 07:11:22 am
There is full replacement cost (Total cost to rebuild using like kind and quality) Actual Cash Value which would be in line with a depreciated value of wear and tear - there are tables for that. Very rarely does the Actual sale price come in to insurance settlements. Also keep in mind the value of the land is NOT a factor in settlement only the structure itself.
Ezra
3/20/2022 07:22:21 pm
My house was considered a total loss. I am not rebuilding on the same spot, instead I will be buy another house. Do I have to buy a house in the USA? Can I choose to buy a house in a different country?
J
9/17/2022 06:23:20 am
I don't understand the ACV minus depreciation. What if you are constantly making improvements, replacing wear and tear, you do a remodel, updrade or do anything really, to increase the value of the home but any proof is destroyed with the house? Does insurance just get to decide what they want to give? Can they decide it depreciated to less than what the mortgage is and leave you with debt?
Ronda Scott
9/17/2022 01:10:45 pm
I m a additional insured on a homeowners insurance policy I'm on a land contract to buy the property my policy says that I am entitled to compensation of my personal assets it states how much for each particular lost how much the payment would be for my clothes and assets and for my medical expenses but I am not the named insured I'm added to the policy I have been paying the premium every month it was added to my initial land contract payment they have not fixed the window yet and they are prolonging the clean of the house my window is broke and flies and everything is coming through the window I tried myself to put something up to the window to preserve my house and the seller of the land contract is telling me that they're going to come out and fix it they are not coming out she went on vacation so it seems like she's trying to get the property back for some reason she is still not yet giving me information on what the fire investigator said or any information on how much I'm supposed to get and they have not been out to the house insurance company to prepare my window so the property is being being affected by the weather what should I do 1/6/2023 06:19:11 am
It's good to know that I would need to use insurance to fix damage to my home. I'll be sure to keep that in mind as I get my insurance plan. It only makes sense that I would need to get a professional to help me out with repairs if I need to have those done. 3/30/2023 11:39:28 am
Whether you need to rebuild for your insurance to pay depends on the specifics of your policy and the type of coverage you have. Leave a Reply. |
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