Back to list

How Much Homeowners Insurance Do I Need?

When a disaster strikes your home, it can be difficult to determine how much homeowners insurance you need in order to help you get back on your feet. Coverages that help you defray the costs of temporary living situations, protect your financial assets, rebuild your home, and replace your personal belongings are some of the coverages to look out for before any destruction takes on your home. To learn how to get cheap home insurance, follow the tips and tricks in this blog post to find and get the most out of your homeowners insurance.

Determine Your Home Protection Needs

Depending on where your home is located, you will need certain coverages to protect you and your home. For example, if you live very close to the San Andreas Fault line in California, you might want to consider purchasing additional earthquake coverage. Nonetheless, natural disasters or destructions like explosions, fire, hail, lightening, etc. are a handful of disasters that majority of homeowners insurance policies provide protection for. In every scenario listed, you want to make sure that the limits in your home insurance policy is high enough to cover the fees of rebuilding your home. The current market price for your home may be more or less than how much it costs to rebuild it. If your home insurance policy’s limit is based on your mortgage, then it may not be sufficient enough to cover the total cost of rebuilding your home.

Major Factors That Can Affect Home Rebuilding Fees

The amount it costs for local construction and the total square footage of your home are key factors in determining how much it costs to rebuild your home. Additional factors that can come into play may include: the type of home exterior materials used, other detached structures on your property, any renovations you made, etc. To roughly estimate the amount of homeowners insurance that you need, multiply your total home square footage by the local per-square-foot of building costs.

Another factor that can make a huge impact on the cost of rebuilding your home is inflation. If you plan on having possession of your home for a while, then add an inflation guard clause to your homeowners insurance policy. This will adjust the dwelling limit on your insurance and reflect your current local construction fees when you renew your home insurance. Keep in mind that major natural disasters can affect not only your home, but also others around you. This will lead to an increase in demand for those building supplies and construction workers, and eventually cause the rebuilding costs to surpass your homeowners insurance policy limit. To protect yourself from this scenario, consider investing in a replacement cost policy that will cover the rebuilding costs for your home before the destruction.

A good grasp on this topic will supply you with the tools you need to learn how to get cheap home insurance. If you need assistance in determining which homeowners insurance is the best for you, connect with a Get-a-Quote professional today or read more blogs on our website. Get-a-Quote is an excellent insurance shopping tool, giving you direct assistance through human interaction.