Does Your Policy Cover Replacement Costs?

By Mark Callender

Hello, my name is Mark Callender and I am a licensed real estate agent with RE/MAX Results. Because I have been helping families buy and sell their homes for more than 18 years, I am now helping their children to buy their first homes and their parents to downsize. No matter the direction you’re moving, my goal is to make the process as calm and enjoyable as it can be.

Today I want to talk about how your insurance policy may be lagging behind the actual replacement cost of your home. Today’s market values are rising very quickly. Over the last year, they rose 20%. If you have an insurance policy that hasn’t been updated in five years, you may want to have a conversation with your insurance agent to make sure that you’re covered for the current replacement cost of your home.

Remember that there is a difference between market value and replacement cost. The replacement cost is what it would take to actually replace the structure on the land that you own. The market value is what somebody’s willing to pay for the home, including the land and all the structures. With building material and appliance costs going up, your replacement cost is rising quickly.

If you have any questions, feel free to reach out to me by phone or email. I look forward to hearing from you.