Atlantic Mutual Has Available Checklist to Make Sure Homes Are Properly Insured

September 15, 2004

Atlantic Mutual Insurance Co., a specialist in providing personal lines insurance to affluent policyholders, is offering a free checklist to help homeowners determine if their homes have the proper amount of insurance. The checklist is available at

Recent hurricanes and wildfires have reportedly led some homeowners to discover that they must pay more out-of-pocket to replace or repair their homes, according to published reports. The New York Times recently noted: “[The] woeful shortfall in insurance coverage, experts say, is a plight shared unknowingly by millions of American homeowners.”

Some 64% of homes are underinsured, according to the 2003 insurance-to-value quality index compiled by Marshall & Swift / Boeckh, a construction information firm. That means millions of homeowners lack enough insurance coverage to fully replace their homes in the event of a total loss.

Dan Olmsted, president of Atlantic Mutual, is urging homeowners to discuss with an independent agent the factors that determine the proper amount of coverage for their home and its contents.

Four of the key factors are:

1. The purchase price or market value of a home is not reliable as an estimate of replacement cost. Mortgage lenders require insurance coverage based on the purchase price. But the cost of rebuilding a home can differ significantly from the purchase price or market value.

2. Improvements to the home have a direct impact on replacement cost. Adding a room or finishing a basement increases the replacement cost of a home. But homeowners sometimes forget to let their agent or insurance company know about such improvements.

3. The size of the home should not be based upon inside measurements or a real estate listing. Proper square footage estimates are based on outside measurements. Real estate ads often use inside measurements, and don’t account for porches or features like vaulted ceilings and bay windows.

4. A homeowners policy may not cover all contents. Homeowners policies insure the contents of a home as well as its structure. But it’s easy to exceed contents limits when there is a collection of fine arts, jewelry, or other valuables. A separate valuables policy may be needed.

Atlantic Mutual’s checklist covers seven key factors and can guide policyholders when working with their insurance agent when their policy nears renewal.

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