6 Questions
What is the primary purpose of guaranteed replacement cost coverage in homeowners policies?
To ensure the rebuilding of the home exactly as it was, regardless of the actual cost
What is the typical limitation of extended replacement cost coverage?
It only applies to the dwelling
What is the requirement for guaranteed replacement cost coverage to apply?
The policyholder must allow the insurer to set and approve the amount of replacement cost coverage
Why is guaranteed replacement cost coverage rare today?
Many insurers were figuratively and literally burned by their guarantees of limitless insurance during the early 1990s
What is the typical range of additional coverage provided by extended replacement cost coverage?
25% to 50% of the policy limit
What is the main difference between guaranteed replacement cost and extended replacement cost coverage?
Guaranteed replacement cost provides limitless coverage, while extended replacement cost provides limited coverage up to a certain amount
Learn about the different types of replacement cost coverage options in homeowners insurance policies, including guaranteed and extended replacement cost coverage. Understand the benefits and limitations of each option and how they can protect your home in the event of a loss.
Make Your Own Quizzes and Flashcards
Convert your notes into interactive study material.
Get started for free
