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Old 11-24-2013, 12:40 PM
 
Location: The Triad (NC)
31,928 posts, read 73,456,595 times
Reputation: 38869

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Quote:
Originally Posted by JesusJosephUS View Post
NEW QUESTION

The total property cost is 390K.
Did I need to purchase insurance for both land and... or just the house value.
If you own it... the REPLACEMENT value + personal effects.

If you don't... what your lender requires to guarantee their loan
as well as the REPLACEMENT value + personal effects.

Is your home really covered by insurance?
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Old 11-24-2013, 09:19 PM
 
1,226 posts, read 2,213,240 times
Reputation: 1864
Quote:
Originally Posted by MrRational View Post
If you own it... the REPLACEMENT value + personal effects.

If you don't... what your lender requires to guarantee their loan
as well as the REPLACEMENT value + personal effects.

Is your home really covered by insurance?
Actually, its illegal for a bank to require you to insure your house above replacement cost to cover their loan. Your House should be insured for how much it would cost to replace the building. It DOES NOT include the value of the land. An insurance company is going to pay 100k to replace a 100k house whether it is on a postage stamp in the ghetto or on 8 acres on the beach. The replacement cost will still be 100k.

Personal property is a separate figure, and is usually calculated as a percentage of your replacement cost (50 or 70%), unless you specifically request and pay for a higher figure. It does not affect the replacement cost of your home. Other figures that you will see as a percentage of your replacement cost is detached structures and loss of use.

Mortgage companies DO often request replacement cost to be at least their mortgage amount. Replacement cost isn't an exact science, so insurance agents will often comply if the two figures are close. However, replacement cost has NO CORRELATION to market value, so if the numbers are off, it is a violation of basic insurance principles and laws to insure property above the value that would be required to make you whole.
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Old 11-24-2013, 11:55 PM
 
2,288 posts, read 2,936,322 times
Reputation: 7039
I'll let the experts help with your questions, I just want to give you a big congrats on your 1st home! Enjoy..
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Old 11-25-2013, 12:23 PM
 
Location: Raleigh
8,164 posts, read 7,236,979 times
Reputation: 10075
Quote:
Originally Posted by JesusJosephUS View Post
NEW QUESTION

The total property cost is 390K. Did I need to purchase loan for both land or just the house value. Because I got different advice from different people.. One of my friend told me just get the loan for house is enough because nothing is going to happen to the land. The other one told me we need it for land and house.

Any suggestion. Please let me know
You seem to be very confused. This thread was about insurance, not a purchase loan. Homeowners insurance does not cover the land, only the structures and liability. You cannot insure against earth movement, but you can buy flood insurance under certain circumstances.
You need to talk to an agent, not a friend.
"just guesssing"
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Old 11-26-2013, 10:42 AM
 
4,539 posts, read 5,692,625 times
Reputation: 3481
Quote:
Originally Posted by cc0789 View Post
I've never heard of Geico doing homeowners insurance, they will outsource you to another carrier. But you will have two different companies insuring you. It might differ in some states though.

Since there are often overlapping liability coverage between home and auto, you really want to be with the same company. You don't want two companies fighting about who's not responsible.

Find an independent agent that can quote you both auto and home. This will be a good time to requite your auto, as you will be getting a homeowner discount.

What state are you in? I can offer you some more specifics if its in a state I'm licensed in.

Geico does home insurance for many many years. I mom had it as far back as the 1970s in New York
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Old 11-26-2013, 11:01 AM
 
Location: Ocala, FL
5,141 posts, read 8,001,983 times
Reputation: 5565
JesusJosephUS,

Short of a sinkhole opening under a home, land is mostly indestructible. Don't get cheap on coverage amounts on the home itself. If you are getting a mortgage on the home, the lender will define what the required insurance coverage will be. Contact an independent insurance broker for specific coverage/policies. This really isn't the place to ask for specific details about coverage..
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Old 11-26-2013, 03:31 PM
 
1,226 posts, read 2,213,240 times
Reputation: 1864
Quote:
Originally Posted by dontaskwhy View Post
JesusJosephUS,

Short of a sinkhole opening under a home, land is mostly indestructible. Don't get cheap on coverage amounts on the home itself. If you are getting a mortgage on the home, the lender will define what the required insurance coverage will be. Contact an independent insurance broker for specific coverage/policies. This really isn't the place to ask for specific details about coverage..
actually, sinkhole is an exclusion for standard homeowner policies

And no, the lender does absolutely not define what the required insurance coverage will be. A licensed insurance agent will determine that amount..... the lender can REQUEST, and they can also be told to go take a hike if they require more than replacement cost.... as forcing someone to take out insurance for more than the value to replace it would make them an accomplice in insurance fraud. Granted, most mortgage brokers are ignorant of the fact and will still request loan amount, but an attorney or underwriter can usually enlighten them of the law.

For example, you build a 100k house on a 20 acre lake access piece of property you bought for 1 million dollars. The house will be insured at about 100k (assuming no increase in construction cost), your loan could have been for 1.1 million. Requiring you to insure the dwelling amount at 1.1 million would fraudulent, as it will only cost 100k to replace your dwelling, and no agent in their right mind would do that.
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Old 11-26-2013, 07:46 PM
 
Location: The Ranch
23,711 posts, read 27,810,705 times
Reputation: 9981
Quote:
Originally Posted by SandyJet View Post
Geico does home insurance for many many years. I mom had it as far back as the 1970s in New York
But no longer under their own name. They are basically a front for selling insurance for other companies.
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Old 11-27-2013, 06:37 AM
 
1,226 posts, read 2,213,240 times
Reputation: 1864
Quote:
Originally Posted by Pruzhany View Post
But no longer under their own name. They are basically a front for selling insurance for other companies.
Yeah, they don't in any state I write in. People will tell me their home is insured with Geico, but they're not, its really handled by a third party....different depending on what state.
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Old 11-27-2013, 03:37 PM
 
Location: The Ranch
23,711 posts, read 27,810,705 times
Reputation: 9981
Quote:
Originally Posted by cc0789 View Post
Yeah, they don't in any state I write in. People will tell me their home is insured with Geico, but they're not, its really handled by a third party....different depending on what state.
And just wait until they file a claim under this so-called insurance to find out how drastically (negative) different that company is compared to the excellent customer service they've become used to when dealing with Geico auto.
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