Problems with valuing property and determining policy limits

Several studies by insurance companies and independent property valuation firms reveal that somewhere between 70-75 percent of all properties are underinsured. The average amount of underinsurance ranges from 25-35 percent. You and your agent/ broker provide the property values to the insurance carrier prior to the policy being put into place. Some property owners rely on the blanket limit instead of having a limit for each property individually. With blanket limits it's important to understand what that means and you need to determine if that is the best approach for your portfolio. Also, keep an eye out for co-insurance as this lowers your limits. If you understate the values of your properties you will have difficulty fully indemnifying the property back to how it was prior to the claim.

Credit to Maureen Gallagher