Tag Archives: apartment

Helping You Understand Your Co-Insurance Clause

NYC apartmentDo you ever wonder why you are required to purchase building limits higher than you believe are necessary? If so, you are not alone. Insurance companies require you to buy building limits of insurance to satisfy the “Co-Insurance” clause in your policy.

Let us tell you more about Co-Insurance and why it’s an important part of your policy.

Co-Insurance requires that a home or business owner have a limit of insurance that is at least 80% of the total replacement cost of the property. Failing to meet this limit of insurance will result in a penalty and you would share in the loss. Here is how the penalty breaks down:

Co-Insurance Formula:

Amount Carried divided by Amount Required, multiplied by The Loss = Payment

Example #1:  80% Co-Insurance with inadequate limits:

Amount Carried: $160,000
Amount Required: $200,000
Total Replacement Cost: $250,000
Loss: $100,000
Payment: $80,000

(160,000 / 200,000) X 100,000 =$80,000 payment. (The insured did not meet the 80% required, so they are a Co-Insurer in the amount of $20,000)

Example #2: 80% co-ins with adequate limits:

Amount Carried: $200,000
Amount Required: $200,000
Total Replacement Cost: $250,000
Loss: $100,000
Payment: $100,000

($200,000 / $200,000)  X 100,000= $100,000 payment. (No co-insurance penalty applies.)

You may initially believe that committing to a conservative building limit would be a way to save money. In the long run, however, it would be unfortunate to encounter a loss and be left without adequate coverage.

If an insurance company determines you have purchased the proper limit, they will sometimes add terms to waive the co-insurance penalty. You can also ask your agent if you qualify for the “Agreed Amount Endorsement” to see if you can void the co-insurance clause.

The time to find out that you are not adequately insured is not the time of your loss. Be safe, protect your assets, and contact us for more information about your co-insurance clause.

Protect Your First Apartment with Renters Insurance

Protect Your First Apartment with Renters InsuranceSo you have finally decided to make that big move to your very own apartment. For the first time in your life, you will be living by yourself – no roommates, no parents, no siblings. You have complete say over the space, décor and furnishings. Although you may think that you are in total control, there are events that can occur that you may have absolutely no control over.

Some of these events can include a neighbor’s candle starts a building fire, someone breaks into your apartment, or a kitchen pipe bursts causing severe water damage. These are all instances that unfortunately occur. Many people are under the impression that their landlord’s policy will cover them. However this is not the case – a landlord’s policy will only cover their building, not their tenant’s belongings. This is why you should consider a policy of your own.

The most common occurrences that a Renters Insurance policy would cover are:

Below are some additional benefits of having a Renters Insurance Policy:

  1. Personal Liability: protects you if you are found legally responsible for injuring someone else or damaging someone’s property
    • It will cover your legal fees
    • If you are found negligent, it will also cover any legal settlements up to your coverage limit
    • Medical payments to others – provides payment of medical expenses for guests who are accidently injured in your home regardless of fault
  2. Personal Property: It will cover most of your belongings, including:
    • Furniture
    • Appliances
    • Clothing
    • Electronics
  3. Loss of use: If your apartment is uninhabitable due to a covered loss, the policy will pay for any additional costs incurred such as Temporary housing
    • Additional grocery/ restaurant bills
    • Cost of moving your personal property to a storage space

With all these benefits included in Renters Insurance you may think that the cost of a policy is astronomical. However, Renters insurance is one of the most affordable coverages that you can purchase, averaging under $20 a month. So why wait for something unfortunate to happen before you consider it? Get it now, and save yourself from any regrets!

Phone: 516-419-5050
Fax: 516-871-0691