The Grubb Company Offers East Bay Insurance Tips

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The Grubb Company advises homeowners to ensure they have the proper level of coverage in their homeowners’ insurance policy.

The majority of American homes are under-insured by an average of 27 percent to 60 percent or more. Contributing factors include rising home values, labor and material costs, natural disasters, changes in the insurance industry, and busy schedules. Because of this, The Grubb Company offer some tips for making sure each homeowner’s insurance policy is protecting each home and family as much as possible.

According to a spokesperson for United Policyholders, an advocacy group for insurance consumers: “Homeowners are often lulled into complacency because they have ‘replacement’ policies, which imply that their insurance companies will rebuild their homes regardless of the cost. True guaranteed replacement policies are almost extinct and virtually all insurers cap the payouts on the more common ‘extended replacement’ policies to 100 percent to 125 percent of the amount for which a home is insured.”

The Grubb Company spoke with Bay Area insurance specialist Jorge Mancheno, who concurs.

“The number one mistake people make is taking their coverage for granted and not understanding their obligations with regard to the contract. It’s on each homeowner to make sure they’ve got the most appropriate policy, appropriate coverage and are holding up their end of the bargain with regard to documentation,” Mancheno said. “For best results you should maintain an ongoing dialog with your agent. The more they know about your situation, the more the carrier will know. The more documentation you can provide, the more you’ll get paid in case disaster strikes... and sooner.”

Mancheno recommends using a local agent to make sure the appropriate coverage is being used.

“Local agents have expertise about real replacement costs based on working relationships with vendors in our localized, higher-end markets,” he said.

Mancheno cites State Farm and Allied as two carriers who have stopped writing homeowner policies in this area.

“Going out of state for your insurance can triple your insurance costs,” he said.

The Grubb Company asked Mancheno for his thoughts and recommendations about earthquake coverage: “The concern with the California Earthquake Authority (CEA) is not whether they will have enough assets to cover homeowners in the event of a quake, but how long it would take to get reimbursed,” he explained. “AARP offers discounted pricing worth considering. Either way, what I hear from financial advisors is if you have 35 percent or more equity in your house, you should strongly consider earthquake insurance. If you have 50 percent or more equity, you need it.”

Follow these basic guidelines to be sure an insurance policy is being used to its full worth:

  • Don’t get caught by surprise. Read the policy from front to back, look for gaps in coverage, and keep things up to date. It is important to review personal property insurance needs and consider buying additional coverage.
  • Keep a current detailed inventory of all household possessions. Many policies limit the contents coverage to a percentage of the overall policy limit. The only way to know for sure if enough coverage is being used is to do the math. Keep written copies of all documentation off-site, perhaps in a safe deposit box.
  • Stay current on replacement costs in the local area. Work with a local real estate agent to confirm square footage and assess square-foot replacement costs. Make it clear that the desire is to get the best coverage for the money paid, rather than the lowest premiums.
  • Check the “loss of use” coverage. Homeowners’ policies typically provide money to pay rent and related living expenses while the home is being rebuilt. If the amount offered won’t cover expenses for two full years, ask for a higher limit or find another insurer.
  • Make sure the insurance agent is contacted about any remodeling or renovation projects. The agent should be able to provide an estimate of how a particular home improvement project will affect any and all insurance costs.
  • The agent has a duty to see that the coverage is adequate. If there hasn’t been any contact to update the coverage in the past few years, it may be construed as an error and omissions in not performing that duty.

Please call or email with questions or comments about this article, or for referrals to qualified insurance agents.

For more information about The Grubb Company, please visit

About the company:
The Grubb Co Realtors is a full-service real estate firm, offering their clients a smooth and professional real estate experience. With more than 44 years in the business, The Grubb Company knows that a high level of service ensures the satisfaction of their clients. They have a foundation of discipline, accountability and teamwork that sets them apart from other real estate firms in the area. The Grubb Company is committed to providing their clients with the best agents, the best service and the best houses around. To learn more, visit their website at

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Susan Kline