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Since my home insurance just went up $250 a year (no claims - at all- no hurricanes, tornadoes, fires, earhthquakes, etc....) I have a general question before I start researching:
If the tax records on a house show land value = $100,000 and house value = $200,000 (these are fictional), do you get insurance to cover just the house value of $200,000? I overheard a converstion between 2 guys recently and this is the figure they used to determine home ins. coverage (house value only).
It isn't the value of your house that you insure, it's how much it will cost to rebuild the house. No, the land value is not taken into consideration for that. However, in this housing market, a lot of people are adjusting their homeowners insurance to match the 'value' of their house and that is just not a good idea. We could not rebuild our house for the tax assessed value of our home right now. Drywall still costs what it costs and the tax assessor really doesn't have any say in that .
I've had several workmen here lately and based on the estimates I've received for minor stuff it would cost 5X what this house is worth to rebuild it. Thanks for the response - I needed someone to confirm what I was thinking was correct.
Also factor in *what* could be damaged that would require rebuilding.
If it is all wood construction and the whole works could burn to the ground, then insurance for an entire rebuild would be a good idea.
Or if solid concrete walls, no earthquakes or hurricanes in the area, just wood interior walls and roof, then the walls should not need rebuilding if there was a fire.
If you want lower rates, get a very high deductible like $2000. The idea is you could cover small losses, but if there was a major loss, the insurance company would cover that. This can reduce premiums quite a bit.
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) I have a general question before I start researching:
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