What is the 80% rule in insurance?
What is the 80% rule in insurance?
The 80% rule means that an insurer will only fully cover the cost of damage to a house if the owner has purchased insurance coverage equal to at least 80% of the house’s total replacement value.
What should you insure your house for?
Most homeowners insurance policies provide a minimum of $100,000 worth of liability insurance, but higher amounts are available and, increasingly, it is recommended that homeowners consider purchasing at least $300,000 to $500,000 worth of liability coverage.
What are the 3 basic levels of coverage that exist for homeowners insurance?
Homeowners insurance policies generally cover destruction and damage to a residence’s interior and exterior, the loss or theft of possessions, and personal liability for harm to others. Three basic levels of coverage exist: actual cash value, replacement cost, and extended replacement cost/value.
