I have been paying for 2 home ins policies on the same house by mistake

[gustav1]

What is the name of your state (only U.S. law)? LA

By mISTAKE i HAVE BEEN PAYING FOR 2 INS POLICIES FOR MY HOUSE. NOW THAT THE HURRICANE HAS DAMGED MY ROOF AND some sheetrock to the tune of 20k I wonder how I should handle this.

one policy has a 5k deductible and the other has a 1k deductible.

of course I would use the 1 k deductible given the choice but why shouldnt both companies pay the full price minus the dedutible? how would they know that I have 2 policies and if they do know why did they not say anything while I was paying for both?

I thought when I changed ins 5 months ago that the new ins company was going to send a notice to the old company but apparently they did not....


at the very least I feel I should not be paying any deductible

thanks

 

[tranquility]

It's a very simple topic called Coordination of Benefits. (COB) It is unusual for property issues. Simply read you policy, the answer will be clearly written there. As a general rule, insurance will not allow you a profit. I also believe the end result will be that you pay the lesser amount of deductible and not be compensated for that. Property can be weird and I may be wrong, but that's my gut.

I'm sure some of the forum's members more knowledgable in insurance issues will give the exact amount you will be responsible for and why.

 

[moburkes]

Not really, tranq. The deductible isn't what makes the determination at all.

In property insurance there are 2 types of loss settlement options when the property is insured by 2 different insurance companies. I honestly don't remember how the deductible issue works when they are different, though.
1. The insurance companies determine how much the building costs to rebuild (the replacement cost). For most insurance policies, insurance companies require the homeowner to insure the building for at least 80% of its replacment cost. If it isn't - uh oh!
2. Pro rata - Say the building's replacement cost is $100k, and Company A has $10k coverage, and Company B has $90k coverage. Company A will pay 10% and Company B will pay 90%. This clause in the policy is called "Other Insurance"
3. Equal Shares - The 2 policies pay equally up to the Coverage A limit of the "smaller" policy, then the policy with the higher limit continues to pay, if necessary, until the claim is paid or the Coverage A limit of that policy has been reached.