I have ever tried to fathom out how insurance companies work because they always seem
To have an answer from what I have been told with regard to a “ Claim “ then should one be lucky enough to get paid for the claim you can be sure your premiums will increase not to mention
The Yearly premium reminder which comes showing an increase. To me it seems like one
Is paying for insurance but getting nothing in return..

I totally agree with you. But what to do about it? Fees go up but for what and who benefits? Definitely no the consumer. No different to Woolies, banks etc. etc. Government does not take enough control of these issues.

orange said:

I have ever tried to fathom out how insurance companies work because they always seem
To have an answer from what I have been told with regard to a “ Claim “ then should one be lucky enough to get paid for the claim you can be sure your premiums will increase not to mention
The Yearly premium reminder which comes showing an increase. To me it seems like one
Is paying for insurance but getting nothing in return..

Click to expand...

orange said:

I have ever tried to fathom out how insurance companies work because they always seem
To have an answer from what I have been told with regard to a “ Claim “ then should one be lucky enough to get paid for the claim you can be sure your premiums will increase not to mention
The Yearly premium reminder which comes showing an increase. To me it seems like one
Is paying for insurance but getting nothing in return..

Click to expand...

arsonist

I would contact your insurance company and get them to advise you (preferably in writing) of their policy regarding this. I think they would call a $200,000 policy on a $400,000 property as underinsured.
Get a quote for both $200,000 and $400,000 cover and compare. The difference may be smaller than you think.

Thr fonz said:

arsonist

Click to expand...

I think you were trying to post in the letter unscramble forum. BUT your answer is weirdly fitting here!

That is basically correct.. Say your house would cost $1,000,000 to re-build but you decide to insure it with an insurance company for $500,000 to save money. That means you are effectively the "insurer for the other $500,000. So if your house is completely destroyed, the insurance company pays you the full $500,000 and you have to find $500,000 so can re-build your house.

If it was partly damaged and the repair cost was say $200,000, then the insurance company pays $100,000 and you have to fund the other $100,000.

The reasoning is that the insurance company has only received premium to insure "half" the cost of replacing the house so they are only obliged to pay half the cost of any damage

Hope this helps make it clearer