Does your homeowner policy have sufficient coverage limits to help you recover fully after a loss and avoid incurring serious financial burdens? It’s a question many people don’t ask, and if they have a claim, it can leave them with unexpected expenses.
Reconstruction cost – or replacement cost – is the cost of hiring a contractor to replace your home as it is, using materials and design of the same or similar quality. This amount is not the same as market value, which is the value of comparable homes that have sold in your area. Your home’s current reconstruction cost could be very different from its market value.
Remodeling and renovation projects can add significantly to the value of your home. Whether you do it yourself or hire a contractor, remember to update your homeowner insurance as you increase your home’s value.