We are frequently asked this question about homeowners insurance — Why do I have to insure my home for $250,000 when the houses in my neighborhood are only selling for $200,000?

Our job, as your agent is to make sure that you have adequate coverage if the worst happens.    Replacement cost is the actual materials, labor, overhead and debris removal cost of rebuilding your home in the event of a total loss.   Market value is the current value of your home on the real estate  market.  Depending on the current market at any given time the replacement cost of your home may be more or may be less than the market value.  If you have replacement cost coverage on your homeowners policy, your company will  require that it  be insured for 100% estimated replacement cost.

Some other factors that go into market value that do not go into replacement cost are size of property, reputation of school district and quality of neighborhood.  These can influence the market value of a home either positively or negatively.  Replacement cost itself can be influenced by temporary increases in building costs  (remember when four hurricanes went through Florida in one summer?  Building costs went up all over the country while Florida was being rebuilt.  Katrina had a similar effect)

Is your home “insured to value”?

Nationwide, 68% of homeowners are underinsured, according to a survey by insurance-services firm MSB, by an average of 18%.

Would you like to find out the current replacement cost of your home?

Fill out the form at the link below and either fax, mail, or email to:

Whitford Insurance
PO Box 820
Exton, PA  19341

Fax: 610-524-8116

Email: [email protected]

We will complete a replacement cost estimator and mail you out the results.

To get a copy of the form, click on this link.  HOME REPLACEMENT COST SURVEY.  You will need to have Adobe Acrobat Reader on your computer to open the file.  Please call our office if you have any questions or want to discuss this issue with your account manager.