Home Insurance..How much is enough?

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PostPosted: Thu Jan 10, 2008 5:28 am   Post subject: Home Insurance..How much is enough?  

I realize this questions is open ended...



However, I am just looking for the basic to start out... and build from there..



Heres the situation...



My house is appraised at 270K... The agent says it would take around 180k to rebuild ground up....



I think this is wrong.... That the coverage for the structure should be higher...



What is the rule of thumb (so to speak) regarding the amount of structure coverage?



Thanks,

Sun

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PostPosted: Thu Jan 10, 2008 12:45 pm   Post subject:   

I've got to say this is odd, I would expect it to be the exact oppisite that it would cost more rather than less to rebuild than the value...hmmmmm..I would want to know first how he came up with this 180k figure? Does that take into consideration all that your home has? for example if you have oak trim in your house is that included in this 180k see where I'm headed? If I were you (after finding out where this came from) I would take all information about my house and go to a home builder in the area, and ask them how much it would cost to rebuild...Some homeowners policys have a guarantee rebuilding coverage set into them....and mine goes up nearly every year because the cost to build a home does as well! That's why I'm really confused. something just isn't right here..sure he didn't say 280k?



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PostPosted: Fri Jan 11, 2008 5:17 am   Post subject:   

I was confused as well... Still am actually..



This is my third house in my life. The structure coverage for the previous two were either equal or more than what it was appraised for...



This house is stucco, which is VERY common here in the PHX area, if that makes any difference.....



I am going to have to dig more on this....

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PostPosted: Fri Jan 11, 2008 5:41 am   Post subject: yupp...it can be  

Quote:
The agent says it would take around 180k to rebuild ground up....


Yes, I also feel that it would cost you higher towards the structure than when you're building it, if you're doing both at one go. But as the person prior to me has pointed out - the costs rise up each year & that might have happened in your case too!



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PostPosted: Fri Jan 11, 2008 9:49 am   Post subject:   

Let us know SunDevilsFan, when you find out...I think this agent has surely made a mistake, and we don't want it to be a mistake that costs you! (he's screwing himself too right? prem on 180k would be less than 270k...*lori is still scratching her head*)



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PostPosted: Sat Jan 19, 2008 4:25 am   Post subject:   

Well, talked with the agent this past week... Sorry for the delay



The insurance company figures about $110 per square foot to rebuild the home. So, if thats the case, that would be at $165,000 to completly restore the entire structure. I will have to talk to some builders aroiund here and see what it costs them to build a home (per square foot, etc)



The second thing I should have realized is that property location here in Phoenix is rather expensive. And, where we live is considered one of three best places to live in the valley. So, within the 270K is the location factor as well..

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PostPosted: Sat Jan 19, 2008 2:04 pm   Post subject:   

good point (location), and of course you wouldn't be purchasing the lot again...I would ask too re: the material used, is that 110.00 for plastic, (wood looking) trim or for painted pine, or stained oak? same with kitchen etc. thanks and please continue to keep us in the 'loop'.



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PostPosted: Sat Jan 19, 2008 2:26 pm   Post subject:   

Lori,



The entire house (outside portion) is made of stucco. This even includes the chimney!! Almost all, or close to it, of the houses here in the Phoenix area are made of stucco. When I lived in the midwest I saw one and told myself I would NEVER have one... Little did I know a couple of years later I would be transferring out here to the valley of stucco (actually, valley of the sun!!). Needless to say, I have grown accustomed to it.



If something, God forbid, would happen to the house as in a fire, I would want the entire house rebuilt to be the same as it is today. That includes granite counter tops and tiled floor... etc. I would not settle for plastic again after I have upgraded everything.



Which leads me to another question. Perhaps I need to put this in another thread. A friend told me I should consider total replacement insurance and not just the basic minimual coverage... If that makes any sense...



Peace,

Sun

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PostPosted: Sat Jan 19, 2008 2:39 pm   Post subject:   

Quote:
If something, God forbid, would happen to the house as in a fire, I would want the entire house rebuilt to be the same as it is today. That includes granite counter tops and tiled floor... etc. I would not settle for plastic again after I have upgraded everything.
THAT was precisely my point!



Quote:
Which leads me to another question. Perhaps I need to put this in another thread. A friend told me I should consider total replacement insurance and not just the basic minimual coverage... If that makes any sense...
No you're alright...I have that on my homeowners, it's called ''gauranteed replacement'' I'm sure all companies offer it...you probably better check that out, because if you have a set amount (which clearly you do), by by upgrades! Rolling Eyes


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