How should you determine the amount of homeowners insurance you need? First, homeowners must realize that the replacement cost and the market value of their homes are not the same. While the market value of a home may plummet or rise depending on a variety of factors, the cost to rebuild a home changes only as the cost and availability of materials change. A 33% drop in the market value of a home does not affect the availability or cost of building materials to replace the home. Therefore, homeowners must properly insure their home to the replacement cost value, not the market value.
It might seem strange to think about. People are inclined to think in terms of value—how much is your car worth? How much did you spend on that coat? But when it comes to insuring your home, the current market value isn’t necessarily the most important aspect–protecting yourself from financial disaster is.
At Foundation Insurance Group, an Erie Insurance Agency, we help figure out what coverage is right for you, depending on certain variables including location and recent improvements you’ve made to your home. Give one of our agents a call at 703-988-3750 or check out our website at www.foundationinsurancegroup.com.
From your local Erie Insurance Agent- Foundation Insurance Group located in Falls Church, VA but as always servicing Arlington, Mclean, Tyson’s Corner, and all of the Metro DC area.