My friends over at United Policyholders passed this article on to me. Lexington Insurance, a division of AIG, is going to be offering some additional coverages for its policyholders, including mechanical breakdown for heating and air conditioning systems and identity theft. Thanks to UP for passing this on. The following comments are mine alone.
I don’t think they are adding any value for 90% of the population. Heck, probably 99% of the population. Identity theft coverage does not really provide you any coverage. Generally, this coverage just helps you get a fraud alert on your credit. Great, you can do that for free. The mechanical breakdown coverage would be fine, but your home warranty will cover it, and if it is a new appliance, then you have a manufacturers or extended warranty.
Lexington is going after high dollar homes with this policy. Not surprisingly, they do not offer it to the “Average Joe.” Why is that not surprising? Because insurance companies offer their upgraded policies only to those people who pay a lot in premium. And who is that? People who have expensive homes to insure.
If you are one of the people in the target market, don’t buy the policy just for these benefits. I don’t think they are worthwhile.