How do I determine your homeowner’s insurance coverage?

If you are serious about protecting one of your biggest investment -- please consider the following information to help you determine the coverage you need for your home.

• Get an estimate of the replacement cost of your home, and

• Select the coverage amount that best fits your needs

Most insurance companies recommend that you purchase an amount of coverage at least equal to the estimated replacement cost. But the choice is yours. Determining your home’s estimated replacement cost is important because this will ultimately determine which policy options are available to you. Since it is impossible to predict today what the exact cost will be to replace your home in the future, it’s important to have enough coverage to account for unforeseen circumstances.

What is the difference between replacement cost and market value when it comes to insurance?

Replacement cost is the rebuilding cost necessary to repair or replace the entire home.

Please note replacement cost is not:

• The market value of the home.

• The home’s purchase price or the cost of the land.

• The outstanding amount of any mortgage loan.

Market Value is the amount a buyer would pay for a home, including the land, regardless of how much it would cost to rebuild the home.

There are several ways to determine the replacement cost for your home

• If buying a new home ask if a replacement cost estimate is available when you have the home appraised.

• Consult a local builder association or a reputable builder for an estimate.

• Or our insurance rater can assist in determining your replacement cost.