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Publication #FAR9007

Disaster Planning: Insurance Coverage 1

Donna Davis2

Until hurricane season in Florida this fall, many homeowners had never really looked at their homeowners' insurance policies, nor did they think they really needed to spend their valuable time on such details. But, for many, after the storm was too late.

Some Floridians learned the hard way that they had less homeowners' insurance coverage than they thought. Some found out that they didn't have enough coverage—that is, their policy was written for less than the standard: a minimum of 80% of the value of their home. Other homeowners were surprised to learn that their policy had a deductible for hurricanes that amounted to two or three percent of the value of the house.

Likewise, homeowners didn't remember if they had purchased either replacement cost or actual cash value insurance for their home. It's important to know the difference. For example: if you purchased a TV for $700 in 2000 and it was destroyed, actual cash value replacement would reimburse you for the value of a four-year-old television, or maybe $300.

If you'd purchased replacement cost insurance on your home, and the same TV now costs $900, you would initially receive the cash value of $300, but when you replaced the TV and presented receipts to the insurance company, you would be reimbursed the remaining $600.

It's important to remember that with any loss, you should keep receipts for repair and replacement of items. If your insurance company doesn't reimburse you for all losses, you may be eligible to deduct some of the loss from your income taxes.

Listening, learning, and living together: it's the science of life. "Family Album" is a co-production of University of Florida IFAS Extension, the Department of Family, Youth and Community Sciences, and of WUFT-FM. If you'd like to learn more, please visit our website at

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This document is FAR9007, one of a series of the Family Youth and Community Sciences Department, UF/IFAS Extension. Broadcast as program 50 and published December 2007. Reviewed January 2015. In the interest of time and/or clarity, the broadcast version of this script may have been modified. Visit the EDIS website at


Donna Davis, senior producer, Family Album Radio, Department of Family, Youth and Community Sciences, UF/IFAS Extension, Gainesville, FL 32611.

The Institute of Food and Agricultural Sciences (IFAS) is an Equal Opportunity Institution authorized to provide research, educational information and other services only to individuals and institutions that function with non-discrimination with respect to race, creed, color, religion, age, disability, sex, sexual orientation, marital status, national origin, political opinions or affiliations. For more information on obtaining other UF/IFAS Extension publications, contact your county's UF/IFAS Extension office.

U.S. Department of Agriculture, UF/IFAS Extension Service, University of Florida, IFAS, Florida A & M University Cooperative Extension Program, and Boards of County Commissioners Cooperating. Nick T. Place, dean for UF/IFAS Extension.