Repeat After Me, Coinsurance Is Bad!

For the 432,234th time now, I have had an agent send me a proposal of insurance that includes coinsurance.



Insurance buyers, ask your agent if you have coinsurance on your property insurance policy. If the answer is yes, ask your agent why they have allowed your insurance company to include a penalty that might hit you when you have a loss.



For the insurance buyer, a coinsurance penalty is ALWAYS bad. It means that there is a chance that a partial loss might not be covered like you think it will be.



If you are interested in knowing how coinsurance works and how the penalty hits you, send me an email (or use the search bar to the right).



Frankly, all you need to know is that coinsurance is a penalty - penalties are never a good thing. Your agent is supposed to be helping you avoid bad things, and if you have coinsurance, YOUR AGENT IS NOT DOING HIS OR HER JOB!!!!



(Note to Insurance Geeks: Please do not send me emails lecturing me on the benefits of coinsurance. Do not tell me that it is a rating necessity that really benefits insurance buyers. Insurance buyers should buy the right amount of insurance - if they do that there should never be a coinsurance penalty. No individual insurance buyer has ever been better off at the time of a loss by having a coinsurance clause in his policy.)

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