Rising Construction Costs!

Exposing the Limitation of Basic Home Insurance Policies

Insuring your most important asset, your residence, with a basic home insurance policy (vs a premium contract), comes with a wide range of coverage limitations. The most important one being the Replacement Cost limitation on rebuilding to the insured value of your home.

As an example, if your home policy lists the rebuild value at $2M, the policy language limits the replacement cost to $2.5M.

That is a problem in today’s inflationary world.

Here is why!

Inflation is pushing construction costs up in the following areas:

• Roofing – 18.5%
• Lumber – 15.5%
• Drywall – 19%
• Windows/Doors – 16.5%
• Plumbing – 35%

Inflation is exposing the cap, or limitation of replacement cost coverage found on a basic home insurance policy.

It might be time to investigate a premium insurance contract issued by companies like Chubb or PURE, where replacement cost, regardless of what the construction costs end up being, are guaranteed. Without limitations!

Fine tuning the coverages of a premium home insurance may surprise you on how affordable it can be.

If you have questions drop Kyle an emai at kshepard@shepardinsgrp.com or call 203.698.9342 to set up a time to discuss.