Full Replacment Value Homeowners Insurance

[jIM_Ohio]

I fail to see the benefit of insuring over 100%. The insurance company is not going to hand you $310K if disaster strikes. Unless you have non traditional policy, you will be required to have 3 quotes for each construction replacement step. In some instances, the insurer pays the contractor, trades and suppliers. The rooms will be covered in the same configuration as original. Some items will be upgraded due to code but you will have to negotiate with insurer who is trying to do as cheap a replacement as possible. Energy efficient windows, heating, insulation etc. is fight,, fight, fight. Ask all those folks in Kristina's path who are still fighting to get re-built!

If you live in an area where you bought 20 years ago for 150k and the house is now 450k-600k in value, you are best to insure for the value, as it will likely cost more to rebuild the house than you paid for it.

Insure for more than 100% of value because real estate costs fluctuate year over year, and if costs go up, you need that cushion.

[snafu]

Thank you jIM for the explanation. Sadly, not until we have a claim, do we learn that there is an adversarial relationship between the claims officer and home owner. The insurance agent who collects his annual commission plays no role. It is the role of home owner to prove their entitlements while it is the duty of the claims officer to pay-out minimums no matter claim details.

Perhaps we should mention how important it is to review insurance coverage each year when the policy is renewed. There may be significant changes in value of your dwelling, materials, tradesmen hourly rate or new, expensive items added to contents. Your insurance agent may not know your district well, so it is the owner's responsibility to work out the square foot replacement cost of buildings on their property.