Is Your Home Insured at the Correct Value?
Your homeowners insurance provides crucial financial protection if your home is damaged or destroyed. But if your house is underinsured, you could be left with costly out-of-pocket expenses that leave you unable to rebuild your house. For this reason, your home must be correctly valued.
Contact Crume-Evans Insurance in Kokomo, Indiana, to learn if your house has adequate insurance coverage.
How Could My Home Be Incorrectly Insured?
If your home is insured at market value—the amount your home is worth on the housing market—it could be overinsured or underinsured. This is because market value can fluctuate with external factors that impact how desirable your home is to others (e.g., location, local crime rates and the cost of nearby houses) and may not factor in other variables that could increase the cost to rebuild your home (e.g., increased labor costs and supply shortages).
Buying market value coverage could result in insufficient coverage that leaves you responsible for a large percentage of repair or rebuild costs if your home is destroyed. Contact Crume-Evans Insurance for guidance on your homeowners insurance coverage options.
How Can I Insure My Home at the Correct Value?
One way to ensure your home is covered at the correct value is to choose replacement value coverage. The replacement value of your home is the cost it would take to rebuild your home at the current prices for construction materials and labor. By choosing this type of coverage, you can ensure sufficient coverage to rebuild your home from the ground up if a covered peril results in its destruction.
Examples of common costs included in replacement value coverage include the following:
- Local labor costs
- Property demolition and debris removal costs
- Local construction costs
- Labor and construction supply and demand
Insuring your home to at least 100% of its estimated replacement cost can enable you to bounce back from disaster with minimal financial disruption.
Additional coverage enhancements, such as extended and guaranteed replacement costs, may be available with your insurer.
How Can I Get My Home Insured at Replacement Value?
You may be able to get your house’s replacement value estimated by your insurer; however, you can also hire a licensed appraisal to estimate your house’s rebuild costs.
The agents at Crume-Evans Insurance can help you get started with a tailored homeowners insurance quote. Contact us today for more information on your replacement value coverage.
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.