I am looking for HO-6 insurance for a condo unit I have. State Farm tells that they provide loss of use coverage at 40% of personal property. Assuming an implied rental value of $2500 a month and I wish to get 1 year of loss of use coverage, so its $30,000. Then I have to get $75,000 in personal property coverage.
Maybe I am unusual in this regard, I have nowhere close to $75,000 in personal property. So I am being force to pay for coverage that I have no use for.
I know in HO-3, which is designed for single family, loss of use coverage is based on % of building property. And that make sense, since implied rental value is directly correlated with value of the property. But in HO-6, there is no obvious correlation between the value of personal property and the implied rental value of the property. I guess one can argue someone living in an expensive place is likely to have expensive stuff like watches, jewelry, etc.
Anyone else has this issue?
Loss of use coverage as % of personal property
byu/Unfair-Inspector-121 inInsurance
Posted by Unfair-Inspector-121
2 Comments
HO3 homeowners insurance also has personal property set at 50 or 70% of dwelling coverage
Where as Loss of use is set at 20% of dwelling.
In other words, the HO3 policies that have the scaled loss of use coverage you want, also typically have much more than 75k in personal property coverage.
Honestly? On am H6, while 15-25k is common, 75k or more is often recommended.
In other words, you’re wanting loss of use coverage which would be disproportionately high compared to other coverages on any property policy.
What’s it matter if the price is a minor increase to up the personal, property to get more loss of use? Condo policies are usually cheap. If you have to increase personal property to get more loss of use, and the price is reasonable to you, think of it as just paying for more loss of use?
Safeco condo policies let you choose your loss of use coverage. Check them out.