Replacement Cost vs Market Value

Replacement Cost vs Market Value

When you think of what your home is worth, you tend to think of either what you paid for it, or the price you can sell it for on the open market. But insurance carriers are more concerned with the replacement cost of your home. This is essentially the amount it would take to rebuild your home from scratch in the event of a total loss.

replacement cost








Some factors that go into replacement cost

  • Roof and shingle style and quality, which can vary widely from home to home
  • Exterior features like porches, decks, and breezeways
  • The age and quality of your heating and cooling systems
  • The materials used in your kitchen and/or bath
  • The style of your garage, and whether it is attached
  • Present-day costs of building materials and labor
  • The costs of debris removal, which are not included in new home construction

Replacement costs can change during the life of your home. That’s why it’s important to make sure you have the coverage you truly need should you ever suffer a total loss. Contact The Hanover and Professional Underwriters, who have the tools and expertise that can help you determine the right replacement cost for your home.

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