Replacement Cost As DP1 Limits?

[tammysue]

Hi all, I would like to know if you should put the ACV value as the insurance limits on an ACV policy or the Replacement cost on the ACV policy? Thank you for your input!

 

[djs]

First, let me say that selling a DP-1 policy should be a very, very, very rare thing. You'll have one very upset client when a claim comes along, or worse, when something that they think should be covered isn't covered because its a DP-1.

I'd ask the carrier what they want for dwelling value. My guess is that they will want full reconstruction cost that they will then 'pro-rate' to ACV during claim time.

Dan

 

[LostDollar]

First, let me say that selling a DP-1 policy should be a very, very, very rare thing. You'll have one very upset client when a claim comes along, or worse, when something that they think should be covered isn't covered because its a DP-1.

I'd ask the carrier what they want for dwelling value. My guess is that they will want full reconstruction cost that they will then 'pro-rate' to ACV during claim time.

Dan

That was educational. I didn't know what DP-1 was-looked it up.

Looks to me like missing coverage for vandalism and water damage could be pretty serious issues in today's world.

 

[KenP]

Hi all, I would like to know if you should put the ACV value as the insurance limits on an ACV policy or the Replacement cost on the ACV policy? Thank you for your input!

It sounds like you're asking: How much Coverage A should I choose so that, when depreciation is factored in, the client can still get replacement cost?

That begs the question: Why are you putting them on a DP-1 form in the first place?