The idea of insuring to value is straight ahead, insure your property to the limit that is needed to repair/replace the property. The problem is that the replacement value of your property is not determined until after a loss has occurred, and there can be ide variations in the estimated cost to rebuild your property. Any of the following can affect the cost to rebuild your property:
- Large number of losses in 1 area,
- Multiple losses across a larger area
- Limited supply of goods needed to rebuild your property (pandemic related supply issues)
- Changes in building code that has increased the cost to rebuild your property
- Large discrepancies in the tools used to estimate the replacement cost of your property
In short, there are many factors that can affect the cost to rebuild your property and the exact number will not be known until after a loss. Work with your agent or broker to come up with a realistic value and insure to that value, and when available, add the extended coverage endorsement.
If you would like a no obligation review of your coverage, please reach out to us at: Quotes@BandCIns.com