What is the Insurance Dwelling Value?

Residents of Chandler, AZ are not required by law to obtain home insurance, but many will choose to do so to protect their investment. In addition, a bank will usually stipulate that their customers must purchase a home insurance policy. When purchasing and maintaining home insurance, it is important to understand what your insurance dwelling value is, and we will discuss this in detail. 

Insurance Dwelling Value

Many people make the understandable mistake of wanting to insure their home for how much it is currently worth on the market, but this is not an accurate way to measure how much insurance you will need. This is because you will need to pay the replacement cost of your home in the event of a total loss, and this amount will likely differ from the home’s current market value. Replacement costs tend to rise when house prices increase, but they also tend to stay the same even when those house prices go down. 

Keep in mind that your insurance dwelling value will likely also increase when you build additions, decks, sun rooms, or garages unto your home. When adding onto your house, it is best to speak with your agent to make sure your indemnification is commensurate with the worth of the structure. Sometimes the state you live in will pass ordinances, such as new wiring and building code standards, that will affect how much it would take to replace your residence, and this must also be taken into consideration when insuring your home. 

San Marcos Insurance Group Wants to Help You

San Marcos Insurance Group is a fine purveyor of insurance with experience serving the Chandler, AZ area. Our friendly agents can answer any questions you may about home insurance, including insurance dwelling values. Contact us today to schedule an appointment, and we can find the right insurance package for you.