It is estimated that around 60 percent of Americans have homes which are underinsured. Since your home is more than likely your largest single investment, insuring it adequately is an important part of maintaining your financial foundation.
First, your insurance should cover your home for the amount it would cost to rebuild in the event of a disaster like a fire, tornado, hurricane or other insured catastrophe. This amount of insurance should cover the cost of rebuilding your home at the current construction costs, excluding the value of the land. The cost of rebuilding should be around the price you could sell it for today, not the price you paid for your home when you bought it.
There are other thoughts to take into account when determining the amount to insure your home for, such as
- Local building codes regulations and/or more expensive materials
- The expense of clearing damaged property from the lot before construction can begin
- Rapid inflation in the cost of building materials and labor that can follow a major disaster to an area
- Fees for an architect, design professional and contractor
There are several methods used to estimate the replacement cost of a home. Some of the factors are:
- Foundation type
- Square footage
- Type and quality of building materials
- Number of rooms and baths
- Attached or detached garages and other buildings
- Upgrades inside the home
Ultimately, it is your responsibility to establish the value of your property and select the amount of insurance for your policy that will adequately cover you in case of an disaster. Loftis & Wetzel Corporation can help with your Edmond Home Insurance decisions and explain what you can do to avoid an unpleasant surprise after a loss. Give us a call today at 855-360-0466 and we can help you develop the home insurance solutions that are a right fit for you.