Understand the value of your home
Personal Property Wizard
How much would it cost to replace your home's contents?
Do you need to customize your insurance to protect valuable items? Find out with our wizard.
Personal Risk Wizard
Things change and your insurance protection should keep up.
Our wizard will help you review your risks and evaluate your insurance needs in just a few minutes.
Your insurance policy should cover your home to the full replacement value of the dwelling It self without the land value included. If your policy has not been updated in years you may be dramatically under insured.
Over the past several years, several weather-related catastrophes have highlighted the importance of knowing the appropriate replacement value of your home. Many factors such as hurricanes and increased world demand have caused the cost of building materials and labor to dramatically increase. This in turn has caused the replacement value of your home to increase faster than the general rate of inflation.
If your home were declared a total loss due to a hurricane and the home was insured for 70% of the actual current replacement cost, what would you do? In most cases your replacement house would have to be smaller or of lesser quality than your previous home. This can be avoided by having an annual policy review with your agent. Your home is your single greatest asset (other than you), it needs to be protected with the correct amount of insurance.
There is a difference between Market Value and Replacement Value
- Market value includes the value of the land. This is what a buyer is willing to pay for your home. This may actually be more or less than what it would cost you to replace your home. This value is primarily determined by market conditions, including available home on the market and interest rates.
- Replacement value is simply the cost to replace you home taking in to account many different factors. Typically, replacement value is less than market value (with some exceptions). The cost to rebuild your home is based on:
- Local construction costs
- Square footage of the structure
- Type of exterior wall construction -- frame, masonry (brick or stone) or veneer
- Style of the house (ranch, colonial)
- Number of bathrooms and other rooms
- Type of roof
- Attached garages, fireplaces, exterior trim and other special features
