How Much Insurance is Enough?
The cost to rebuild your home is its
replacement cost. This can be very different from the
estimated market value or actual purchase price. It is
therefore very important to try and determine what coverage
for a dwelling should be.
Deciding How Much Insurance is Enough
We will work with you to estimate the
replacement cost for your home and adjust your policy limits
from time to time to reflect changes.
It is critical that you provide us with
accurate, updated information about your home and contents. If
your dwelling limit accurately reflects your home true
replacement cost, some companies will pay more than the limit
if a covered loss is greater than the limit on your policy.
Ask us if Full Value Replacement Cost is available for your
Once a review of your home and possessions
indicates you are properly insured, it's a good idea to
examine your coverages and limits from time to time,
especially whenever you make improvements or additions.
Be Sure You Have Enough Insurance
Here are some steps you can take to reduce
the danger of being seriously underinsured:
- Call us. If you have questions or
concerns about the limits in your policy, ask us to review
the amounts with you.
- Read your policy. Certain property,
such as jewelry, furs and fine arts are better insured
separately. Knowing what is covered and for how much will
help us insure you properly. If there is anything in your
policy you don't understand, contact your agent and ask
for an explanation.
- At each annual renewal of your policy,
you receive a new Policy Declarations page showing limits
of coverage, optional coverages and endorsements. Review
this information. If you do any significant remodeling or
add a family room, extra bedroom or bathroom, etc., tell
us about these changes so your coverage limits can reflect
- Consider carefully whether your policy
provides all the protection you need. Does it provide
coverage for extra costs resulting from building code
changes? Does it automatically increase coverage limits
annually to keep pace with inflation? Does it provide
additional funds if the cost of rebuilding your home
exceeds the policy limits? Find out whether your insurance
company will stand behind agreed upon repairs after a
- Does your policy include replacement
cost coverage for your personal property? If not, you can
add it by endorsement. The cost is small, the protection
valuable. Replacement Cost Coverage pays losses to your
possessions at the cost of brand new items. Without this
option, a covered loss to your personal possessions would
be depreciated by air and condition, reducing the amount
you would be paid for the claim settlement.
- Consider whether you should have a
greater Limit of Liability for coverage for personal
property than your policy provides. Personal property
coverage is usually 70 percent of the coverage limit for
the structure. (Example: Dwelling limit is $300,000, your
personal property limit is $210,000.) If you need more
than this, it is available for a small additional premium.
- Prepare an inventory of personal
property items, update it periodically, and keep it in a
safe place outside your home, such as a safe deposit box
at your bank. It will save you hours of time trying to
list everything damaged or destroyed if you need to make a
claim. Even video taping each room with descriptive
information on the sound track can assist you in this
process. Be sure the date stamp is on the videotape and
open drawers and closets doors.
To obtain a free, no-obligation quote for your home and personal belongings,
please submit the form and we will contact you.