What is the 80% rule?
• Insurance companies will require the policy holder to cover 80% of the deductible up front.
• Banks holding mortgages require the policy holder to embed 80% of the premiums into the mortgage.
• Insurance companies require that 20% of the replacement cost of the property be set as the deductible.
• Insurance companies will require the policy holder take 80% of the replacement cost of the entire property in coverage, or they will reduce the reimbursements by a proportionate amount.