Home Replacement Insurance

When is the last time you have had a conversation with your Insurance agent regarding your Home? For most people, it is one, if not the largest asset they have. So why wouldn’t they want to make sure that it is properly insured? With children to get to many sports or school functions, talking about insurance isn’t a priority. So, it seems. Life is way too fast and on the go in the 21st century.

What will happen when the home has a fire and burns down? They will rely on their insurance policy that they having been paying on for years, to be there in the time of need. So, they call and let their insurance agent know that they have tragically had a fire and they no longer have a home to live in. The insurance agent gets in contact with a claims adjuster and gets the ball rolling to get the family into some living quarters.

While this process of living out of another Home and getting your old home cleaned up and replaced can take up to 24 months. When the children are all about their personal and school activities and you maintaining your employment and sanity. This is not for the weak. Now comes the time that you hope and pray that your replacement cost is current to today’s market. What does that mean? Hopefully, the last time you had a conversation with your insurance agent wasn’t about 7 or 9 years ago regarding your Home policy coverages.

When you first get a Home insurance policy, your agent works up what is known as the Replacement cost of the dwelling (home). Putting in all the types of upgrades you currently have in the Home. That will give what is known as Replacement Cost Estimator. Also, with that is another Extended Replacement Cost factor that is added on to the dwelling. Normally on a primary or secondary Home, it is 25 to 50 percent added on.

Just as we recently have heard and witnessed in the Santa Rosa fires, many people didn’t have enough coverage on their dwelling to rebuild. Homeowner’s Insurance is all designed to make you whole again. Meaning to rebuild your home just like you were accustomed to living in. Nothing less and nothing more. Example: If you had beautiful granite counter tops and French doors, that’s what you will get on your replacement home.

Unfortunately, too many times I have new clients come in and I review their current Home policy and I see that their dwelling is underinsured. Make sure you have a discussion with your agent soon to make sure you have proper coverage on your Home. If you have any questions or need any assistance, please call Moe at (925) 757-1000.

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