mbrcatz
 |
OK, you can argue that! $160,000, that means, your house is approximately 800 square feet. All you need to do, is get two different contractors to put that in writing, that they'll rebuild your 800 square foot house at $200 a square foot - the average cost to rebuild, in the USA, and turn that in to your insurance agent.
The company should agree to that. Of course, if your house is MORE than $200 a square foot to rebuild, OR, more than 800 square feet, come claim time, you're going to have a BIG BIG issue - as you'll be seriously underinsured.
Now, most people think, oh, a claim isn't going to cost more than $40,000, so as long as I have $40,000, I'm covered. But that is WRONG, because there is a thing called "coinsurance penalty". Ask your agent to explain it, but basically, it means, that if you insure half the cost to rebuild the house, they cover half the claim. YOU cover the other half.
Now, maybe you're confusing MARKET VALUE, what you could sell your house for - maybe the $180,000, for REPLACEMENT value - what it costs to rebuild. Two different horses. But if you want a MARKET VALUE insurance policy, you can get that. It costs way more, for less coverage, but you CAN get it.
In any case, you SHOULD be discussing this with your agent - and if they can't explain the rates, you need another agent.
But I'll say something else - when people complain to me about how much their house is insured for, that's not REALLY the complaint. The complaint REALLY is, that they don't want to PAY so much for insurance. And there are OTHER ways to cut your insurance costs - and your agent should explain those, also! The easiest ones are, making sure you're getting all the update credits you deserve, putting your car insurance with the same company, and increasing your deductible. If you've got a $200,000 house, you probably can afford a $5,000 deductible on your policy, which could save you up to HALF, if you currently have a $250 deductible. |
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