Home insurance question

[Anonymous]

We bought our house for $1.1 million seven years ago. I was just reviewing our homeowners insurance coverage, and the maximum for dwelling replacement is $750k. Is that enough for a 3,000-square foot house in northern Virginia? Does the insurance company determine this number, or can I pay for a higher maximum?

[Anonymous]

Anonymous wrote:We bought our house for $1.1 million seven years ago. I was just reviewing our homeowners insurance coverage, and the maximum for dwelling replacement is $750k. Is that enough for a 3,000-square foot house in northern Virginia? Does the insurance company determine this number, or can I pay for a higher maximum?

Call your insurance company. But also, remember that you paid for the land your home is on in that $1.1M. In many places, the land is a significant portion of the price. You want to insure for what it would cost to rebuild at the same level of home you have (ie if you have Subzero and Wolf appliances and everything higher end, then plan for that. If you have a basic stove, GE fridge and house has basic carpet and tile, nothing fancy, then plan for that.

[Anonymous]

When you call them make sure you're also asking them about replacement value coverage. EG, if your house burns down, you don't want them saying your 3-year old couch is used and therefore they'll give you $50, you want to be covered enough to buy a new couch.

[Anonymous]

750,000 sounds a bit low to rebuild a house in northern virginia.

[Anonymous]

Anonymous wrote:750,000 sounds a bit low to rebuild a house in northern virginia.

That might rebuild a 1800sf ranch with an unfinished basement if in NoVA.

[Anonymous]

It should have increased a bit every year for inflation. So if it was 750 back then, 850 now

[Anonymous]

Anonymous wrote:It should have increased a bit every year for inflation. So if it was 750 back then, 850 now

OP here - it does increase for inflation each year. Just not sure if 750k would be enough to rebuild the house. It also provides 500k for personal property - that is more than enough because we don’t have a lot of nice things!

[Anonymous]

Anonymous wrote:

Anonymous wrote:It should have increased a bit every year for inflation. So if it was 750 back then, 850 now

OP here - it does increase for inflation each year. Just not sure if 750k would be enough to rebuild the house. It also provides 500k for personal property - that is more than enough because we don’t have a lot of nice things!

Call another insurance company for a quote and see what they assess as coverage A

[Anonymous]

A few companies still offer guaranteed replacement which means they’ll pay whatever it ends up costing

[Anonymous]

Anonymous wrote:A few companies still offer guaranteed replacement which means they’ll pay whatever it ends up costing

Erie is one of them

[Anonymous]

In addition to coverage A - dwelling. Policies typically have a line for cost above replacement value which is usually a percentage of A. 20%, 50% etc.

[Anonymous]

3000x200=600k.

Unless you have very high end appliances or remodeling then your probably fine.

[Anonymous]

Also make sure you have coverage for change in codes.

[Anonymous]

Make sure you have indicated replacement cost for your possessions (not depreciated value).