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Home owner's insurance question

Reading through my policy it would appear that through the personal property section an audio system is covered for loss.  No special rider is necessary.  But the replacement cost section states that the insurance company won't pay until you actually replace your stereo system.  If one makes a big claim, let's say $100,000, how does one pay this first if you're going to get paid afterwards?  What if you don't have the money to re-buy your system or you choose not to replace it?  Can any insurance experts explain to me how these home owner policies actually work?
philharmonicpete
mr_m
1,900 posts
 
Is it true most insurances will cover a "Zombie apocalypse?"...:-)
mrdon
106 posts
 
I have been thinking about the same insurance question since i have revamped both of my systems and continue to add to them. Question is, i have renters insurance only and was told my the issuer that it is capped at 5,000, is there no recourse such as adding or just hunting out an insurer that will increase the coverage? 
philharmonicpete OP
25 posts
 
Thanks for the many excellent replies.  My policy states: "You may elect to disregard the Replacement Cost provision in making a claim, but your election shall not prejudice your right to make further claim within 180 days after the loss for any additional liability brought about by this policy condition."  Is this the legal jargon saying what @dweller and @tuberist state?  In other words you get paid the depreciated value and then the replacement value only if you re-buy?
uncledemp
712 posts
 
I think these are great questions to clarify with your agent. They should know or be able to find out details regarding your specific situation and answer your concerns.

I agree with one of the other posters stating the quality of your rep is an important/critical link in the service chain. I’ve been with the same carrier over 35 years, but did have to request a change in reps one time 15 years ago. Otherwise, smooth sailing.

Best,

Gary
dobnbav
57 posts
 
Get an agent and get 3 quotes. Insure yourself adequately! I’ve move from owning back to renting. I still have $75000 personal property coverage, which in the case of a fire (or collapse of ceiling from an earthquake) it still will leave me 10’s of thousands short—the question being do I need those $10,000 of ties replaced!?! Every policy is different and essentially if you spend the money on something else within your home...as the insurance guy above said, know what you are buying First. Personally, I’d make sure I would get paid up front. Most audio mfg’s At least ethical ones, are going to force an insurance company to purchase through a dealer. Either you sell through dealers or you don’t. And scan every invoice and keep a copy of all in the cloud and on a disk or SSD drive separate.
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