How much should my home be insured for?

⅔ of American homes are under insured!  That means that 2 out of 3 homeowners reading this is in a financial peril.

So, how do you make sure you are not a part of this frightening statistic?  Easy: you insure your home for 100% replacement cost value.  

How do you know if you are insured to 100% replacement cost value?

Only think about three things:

• debris removal
• cost of labor
• cost of material

Forget about market price of your home. How much you bought the home for and how much is worth now means absolutely nothing.

Ask yourself: If my house burns down, how much would debris removal, a contractor, and new material cost?

You might or might not know the answer.  If you don’t know ask an agent to provide you with a replacement cost estimator for your home, or you can go online do one yourself.

Use this as a general guide: most homes should be insured for $150 per square foot (finished space).  Unfinished space is less, maybe $80 per square foot.  $150 is used for standard building materials; for custom/luxury materials and intricate designs used a detailed replacement cost estimator done by a trusted insurance professional.

***This blog post is meant only as a simple guide for general public and because of that I have skipped the scary part of the story which is: what happens if your home is not insured to a full 100% replacement cost?

Short answer is that you are left with a BIG bill to pay, even if you only have a partial loss.

If you need examples or more information feel free to call at 802-505-1054 or e-mail at Irfan@green-insurance-agency.com.