Determine How Much Insurance You Need

Here’s a short cut to estimating the cost to rebuild your home – multiply the local building costs per square footage by the total square footage of your house. To find out the building rates in your neighborhood, consult your local builders association, a reputable builder or contact your insurance agent. You do need the building rates for your area because, for example, it is more expensive to insure a frame house than a brick one.

This formula is only an estimate and several factors to consider when determining the cost to replace your home are:

1) Building costs in your area
2) Square footage of your house and any additional structures, such as a detached garage
3) Type of construction (i.e. masonry, frame, or veneer), materials and special features of
    your home (i.e. fireplace, pool)
4) The number of bedrooms and bathrooms
5) Type of roof (i.e. shingle, tile, or tar & gravel)
6) Garage (single or double) or carport

Check the value of your insurance policy against rising local building cost each year. You may want to ask your agent for “inflation guard” coverage that automatically adjusts the dwelling limit upon the policy’s annual renewal.