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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] You don't need more at this time... Posted by Ward-CA- on October 04, 2003 at 4:26 PM In Reply to: fire insurance posted by gcastro on October 03, 2003 at 10:19 AM : Ward, I bought a property subject to, existing loan, that is worth $200,000 but is insured only for $114,000. I am in the process of selling the home. Question: Should I call the fire insurance company to tell them to increase the insured amount to $200k? =?=?=?=?=?=?=?=?=?=?= Gonzalo, It's a waste of money to over-insure real property. An insurance company is only going to reimburse you for any damage or loss that actually occurred to the improvements of the property?which would exclude the value of the ground itself. Since you generally can't destroy the ground your house sits on, there's no need to insure it. Generally, the ground is worth 1/3 of overall value of the property and the improvements amount to the other 2/3's. So if your property is worth a total of $200,000 then the insurable 2/3's of that amounts to $133,333.33 dollars. Since you have coverage of $114,000 already, and you're in the process of selling the property, I wouldn't worry about your coverage at this point in time. Hope this helps. Follow Ups: Post a Followup: Name : E-Mail : Subject : Comments: : : Ward, I bought a property subject to, existing loan, that is worth $200,000 but is insured only for $114,000. I am in the process of selling the home. Question: Should I call the fire insurance company to tell them to increase the insured amount to $200k? : =?=?=?=?=?=?=?=?=?=?= : Gonzalo, : It's a waste of money to over-insure real property. An insurance company is only going to reimburse you for any damage or loss that actually occurred to the improvements of the property?which would exclude the value of the ground itself. : Since you generally can't destroy the ground your house sits on, there's no need to insure it. : Generally, the ground is worth 1/3 of overall value of the property and the improvements amount to the other 2/3's. So if your property is worth a total of $200,000 then the insurable 2/3's of that amounts to $133,333.33 dollars. : Since you have coverage of $114,000 already, and you're in the process of selling the property, I wouldn't worry about your coverage at this point in time. : Hope this helps. Optional Link URL: Link Title: Optional Image URL: [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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