question about insurance

[timNms]

My wife and I were on vacation in Gatlinburg during the week of Thanksgiving. We stopped in a place to eat and our waitress was asking us how things were in our area post Katrina. She said she met a lady that moved up there after the storm. The lady told her that her insurance would not pay for the damages to her house because she moved away. She said there was a clause in her ins. policy that stated that in order for her to collect ins. money for damages, she had to rebuild in the same place. Has anyone ever heard of such before? I had not.

[MGC]

I've never heard of that before. But, considering how crooked the insurance industry is I would not be surprised. There needs to be Congressional oversight of the insurance industry.....MGC

[stormcrow]

That is sorta close. Some policies has a clause that if you want full replacment cost you must rebuild. You can rebuild then sell. If you do not rebuild then you will receive the Actual Cash Value. The original theory of replacement cost was that you were only entitled to the full replacement cost when you have replaced (or rebuilt). Prior to that in the 70's all policies were ACV.

[CajunMama]

I've never heard of that before. But, considering how crooked the insurance industry is I would not be surprised. There needs to be Congressional oversight of the insurance industry.....MGC

It's also a case of reading your policy before you sign it.

[Lindaloo]

The insurance industry is just about dried up.

tim, the insurance industry does not have that kind of power. My thinking is this person applied for an MDA grant but was turned down because the home was sold. Or if they are now deemed to be in the new flood zone map, FEMA insists that they meet the new elevation. I called the insurance commissioner and was told that this was a new one to them.

Reading your policy is a good thing, but when they try to find loopholes around the policy you read, then there is the problem. Nationwide has been busted for this on numerous occasions and Nationwide is WHY people are suing. State Farm is taking the media bashing, but Nationwide is the actual culprit.

What people do not understand is most of these lawsuits stem from the wind versus water scenario. This was the main loophole the insurance industry is using to get out of paying claims. People who had flood were forced to pay off their mortgages. Very sad situation all the way around for ALOT of people!

Other lawsuits stem from the fact that a particular agent lied telling his customers that the hurricane provisional people had was part of their insurance. It wasn't. It was a totally separate policy to cover the 2% deductible and other structures. Now the insurance companies are telling them if they file this particular claim they will be non-renewed if they sue. That will leave them forced to pay the 400% increase in the wind pool. People were already paying 5,000 a year for the wind pool. They can't afford to pay 10,000.

Our insurance commissioner is in the insurance industries hip pocket. But, people keep voting him back in.

[timNms]

Thanks for the replies. Since I didn't hear the story straight from the "horse's mouth" as the saying goes, I don't know all of the details. But it did sound a bit odd to me that the person's insurance company could do something like that.

[MSRobi911]

Linda I do believe you hit the nail on the head. Nationwide is "not on my side" that is for sure!!!!! It's on the neighbor to the right side of my house and the neighbors to the left side and unfortunately we were in the middle.

I don't think George Dale is in the insurance companies back pocket, I think he is a very precarious position. He has to keep companies in Mississippi and he has to get the residents of the state paid for their claims. I think he is working as hard as he can. Sorry, I know the man personally and I don't think his moral character would let him be like that, but then I could be wrong, wouldn't be the first time!

Mary

[Lindaloo]

I hope you are right about George Dale, Mary. I really do.