Replacement cost coverage: the underinsurance solution

Article Abstract:

The inclusion of replacement cost provisions in homeowner policies and some commercial lines has done much to alleviate the problem of underinsurance, but it has created another problem. Policyholders can carry minimal insurance legally, knowing that they will be reimbursed in full for a property's full value in the event of catastrophic loss. Insurers have resolved this problem by carefully matching premiums with potential loss liability. More significantly, they have forced policyholders to sign coinsurance clauses, which require coverage to be at least 80% of a property's value.

Management, Property and casualty insurance, Replacement cost insurance

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The perils and pitfalls of certificates of insurance

Article Abstract:

Businesses that enter into contracts with each other sometimes share the same insurance policy. The common method for guaranteeing compliance with insurance terms under this arrangement is the certificate of insurance. This document can be problematic if the underwriter is not careful. Certificates with non-standard language, for instance, create the potential for expensive lawsuits if they conflict with provisions in the original policy.

Methods, Contracts, Risk management, Business insurance, Insurance policies

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