Could You Rebuild After a Total Loss?


The frequency of extreme weather events seems to be increasing, and there is a growing consensus that natural disasters are becoming more destructive. Add the skyrocketing costs of construction materials and labor to the mix, and it’s easy to see why now is a good time to assess your homeowner’s coverage. Here are a few things to consider when determining if your coverage is sufficient.

The Cost To Rebuild

Many people choose limits on their homeowner’s policy based on how much they pay for a home, or even how much they still owe on a mortgage. However, in most cases, that will not be sufficient to actually rebuild your home as it stands today.

Personal Property Values

If your home is completely destroyed, chances are that most everything inside will also be lost. Check coverage limits and terms for replacing personal property that gets damaged.

Market Fluctuations

Another important factor you’ll need to take into consideration is the changing market. The law of supply and demand means that the cost to rebuild will generally increase after a natural disaster when resources are scarce but demand is great.

Take a quick look at your homeowner’s policy, and you may be surprised to find that your policy is not adequate for the risks you currently face. If you would not be able to rebuild after a total loss, it may be time to add guaranteed replacement cost coverage to your policy.