Loss Adjustment Feature under Fire Insurance
Summary: Valued policy laws or so-called total loss statutes dealing with fire insurance policies were enacted by many states in the late 1800s and early 1900s, principally as a protective measure for insureds. At present, valued policy laws are in force in Arkansas, California, Florida, Georgia, Kansas, Louisiana, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Ohio, South Carolina, South Dakota, Tennessee, Texas, West Virginia, and Wisconsin .
Wisconsin repealed its law in 1976, and then in 1979 reenacted a more limited valued policy law relating only to owner-occupied one-to-four family residential buildings or structures. Louisiana repealed its law in 1988 and reinstated it in 1991.
In addition, California has a law allowing insureds to obtain valued policies on request by paying for the insurer's inspection and property valuation. Iowa 's insurance code provides that the amount stated in a building insurance policy "shall be received as prima facie evidence of the insurable value of the property at the date of the policy." While not a true valued policy law, the Iowa statute does have the effect of shifting the burden of proof as to building value from the insured to the insurer in the settlement of claims.
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