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
- 3 Cheap Growth Stocks You Could Buy Right Now
- 3 CEOs Who Impressed Us the Most in 2014
- The Boeing Company Sends a Strong Signal of Confidence
- 3 Pharma Giants Growing Significantly Faster Than Pfizer, Inc.
- Can Boeing's 777 Hold the Fort Till the 777X Takes Flight?
- MLPs: Williams Companies Inc. Sees a Once-In-A-Generation Opportunity in Natural Gas