Policyholders come in three general groups: conservatives who are willing to pay extra for what they would describe as “Full Coverage,” risk takers who will accept higher deductibles and restricted coverage “ACV” in order to save money, and the clueless. That’s not counting the criminals who I hope are a very small portion of policyholders and claimants.
There’s a simple solution to the roof settlement problem: just as we give new home discounts which disappear over time as the home ages, insurers could limit themselves to replacement cost coverage on roofs by charging every roof based on it’s individual characteristics, condition, and age. In this scenario, a new roof would generate a discount and resultant lower total premium, which would increase a little each year over the life of the roof, and as that roof nears it’s expected end of useful life, the premium would be steep enough to encourage the insured to get a new roof, or protect the insurur if the policyholder doesn’t. This fluid pricing would also encourage insureds to report to insurers when they make substantial improvements and repairs to their home.
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Policyholders come in three general groups: conservatives who are willing to pay extra for what they would describe as “Full Coverage,” risk takers who will accept higher deductibles and restricted coverage “ACV” in order to save money, and the clueless. That’s not counting the criminals who I hope are a very small portion of policyholders and claimants.
There’s a simple solution to the roof settlement problem: just as we give new home discounts which disappear over time as the home ages, insurers could limit themselves to replacement cost coverage on roofs by charging every roof based on it’s individual characteristics, condition, and age. In this scenario, a new roof would generate a discount and resultant lower total premium, which would increase a little each year over the life of the roof, and as that roof nears it’s expected end of useful life, the premium would be steep enough to encourage the insured to get a new roof, or protect the insurur if the policyholder doesn’t. This fluid pricing would also encourage insureds to report to insurers when they make substantial improvements and repairs to their home.