Most insurance will repair your home or auto to its original condition, but if the insured property is totaled or stolen, the standard policy is limited to its blue book value or in the case of personal property its depreciated value. Your policy normally has a specified limit on replacement of the building on your property. Riders are available that will automatically adjust coverage for inflation or will provide replacement value coverage.
Otherwise, the insured must be careful to keep policy coverage up to date to allow for inflation.
Related Fool Articles
Recent Mentions on Fool.com
- Battery Tech Bringing an End to Oil As We Know it? Not So Fast
- The Government Might Leave Fannie Mae and Freddie Mac Alone
- 4 Money Mistakes in Your 20s That Will Haunt You When You Retire
- The 3 Best Stocks for Investing in Oil and Gas Equipment
- Is Oil Too Cheap for This Materials Company to Go it Alone?
- Watsco Keeps Up Its Record Earnings Run