Inflated value doesn’t mean inflated payment |
Jerry and Becky paid $76,950 for a new manufactured home. Jane, their insurance agent, sold them a homeowners policy on it with a replacement cost limit of $173,200. When a fire destroyed the home in 2003, they decided to build from scratch rather than purchasing another manufactured home.
The claims adjuster's research revealed that a new manufactured home could be purchased for $80,187.18 and he offered that amount to settle the claim.
Jerry and Becky sued both State Farm and their agent, contending that State Farm breached the contract by refusing to pay the policy limit. If it was determined that State Farm did not breach the contract, they argued that Jane should be found negligent because she calculated the $173,200 replacement amount.
The court determined that Jerry and Becky were not injured because State Farm offered to pay the value they lost, and there was no case against State Farm or Jane because there was no injury.
Click here for more details on this court case. |
