Eighty per cent, and I am thirty-nine thousand under it

Good morning. The rerun came back on Friday afternoon, in an email with one line of covering text and an attachment.

I said Monday and it is Tuesday, which I would explain if the explanation were more interesting than forgetting.

The corrected figure sits above my pencil rather than below it, which was not what I expected. Applying a national average to an old limit turned out to understate the thing, for the reason I gave on Friday: it carries whatever error was in the starting point along with it.

The gap between what I hold and what their own estimator says it would cost is a hundred and one thousand eight hundred dollars.

Everything I have written for three weeks has been about a total loss, because that is where a low limit shows up most plainly. The house burns, the limit is the ceiling, the arithmetic is obvious.

On the standard form there is a second threshold that applies to ordinary damage, and I had not run it.

To settle a partial loss on a replacement cost basis, the dwelling limit generally has to be at least eighty per cent of the replacement cost at the time of loss. Below that line, the settlement is worked out on a different footing, and the shortfall follows you into claims that have nothing to do with the house burning down.

Thirty-nine thousand under the line. A kitchen ceiling coming down would have been settled differently, and I would have argued about it with somebody doing the job I used to do.

Several of you will have read last week's letter and wondered whether volunteering an eight-year-old conversion was wise. It is a fair question and I looked into it properly rather than assuming.

The notification obligation I quoted lives inside the extended replacement cost endorsement, which asks the policyholder to insure to full replacement cost, accept the carrier's annual adjustments, and report alterations raising the replacement cost by five per cent or more within thirty days of completion. I do not carry that endorsement, so that particular clause was never binding on me.

Where it does bite is on the claim rather than the policy. Industry guidance is fairly direct that a substantial alteration the carrier was never told about can move a settlement off replacement cost and onto replacement cost less depreciation, which is a different and smaller number. In other words, saying nothing would not have voided anything. It would have quietly changed how a claim was worked out, at the point when I was least able to do anything about it.

Freddie Mac PMMS, 10 Sep 2026. Federal Reserve, 29 Jul. BLS, 12 Aug.

Denise wants to know how I would like to proceed and I have not answered her.

Raising the limit to three hundred and twelve thousand costs something every month for as long as I own the house. The extended endorsement costs less and carries obligations I would then have to keep, which on this week's evidence is not my strongest area. Doing neither leaves me thirty-nine thousand under a line that applies to the ordinary small disasters rather than the rare large one.

I have run the premium comparison twice and I still do not know which of the three I am going to do. Anybody who tells you this part is obvious has not had to pay for it.