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Homeowners Insurance. What Should You Insure Your Home For?

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We are aware that your home is likely one of your greatest assets. We therefore want to be sure it is insured for the correct amount. We get calls from clients advising the market value of their home has went up, so they want to insure the home for the new market value. Insuring a home for the market value most likely will result in the home being over insured. The market value includes items such as the location and cost of the lot the home sits on.

Insure your home for what it would take to reconstruct it.

What we want is to insure the home for the amount it would take to rebuild it should it be a total loss, such as in a fire or tornado. To do this, we need to look at size of your home as well as construction details. Construction details would include the type of flooring throughout the house and details on how the bathrooms and kitchen are finished. These can range from builders grade up to designer builds. Most of our carriers have reconstruction calculators they use to assist us in determining the cost to rebuild your home once we plug in the details. We see construction costs that range from $140 a square foot to $260 and over sometimes. So, it is important to be sure we have a good idea on the features of your home. We also can add in extended dwelling coverage we like to place on the dwelling. This can add 25% up to full replacement cost guaranteed to rebuild your house. This is an assistance in the event of inflation or increased cost to rebuild the residence. We write our clients with the 25% at minimum to protect them.

Insure after home improvements.

Another thing to consider when you renew your homeowners’ insurance is whether you have done any improvements to the home. Have you done a remodel that would increase the cost to rebuild your home? If so, we would want to be sure the dwelling amount reflected this increased cost.

Call us if you have questions.

At Alliance Insurance of the Rockies, we work with our clients to see that their home is insured for the correct amount with the correct limits for all coverages. If anyone has any questions regarding their coverage, they can just call our office. We are happy to go over the coverage and make any recommendations.

Carl Pash

Carl Pash

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