Michelle Dixon April 26, 2011 No Comments

Even with home values sliding, your home is still one of the most valuable assets that you own.  There are many ways and reasons to value your home to include market/resale  value, property taxation, new construction, or for mortgage purposes.  But for insurance purposes the reconstruction value is the most important. The many factors that influence the value of your home are location, construction type, square footage and the amount of customization.  A lot of people just assume that the market value is how your home would be reconstructed, but different homes in different neighborhoods will vary.  Reconstruction cost are the most consistent.  Reconstruction of a home after a loss is greater than the cost of new construction.  With reconstruction after a loss the contractor will have to do many extra things to include:

  • Working around the undamaged portion of the existing structures  and obstacles that were never there before.
  • Follow the current building codes which will make the reconstruction more expensive.
  • Incur the cost for demolition, permit fees, and increased cost for materials.
  • Locate or build special, customized areas and features

The benefit of having the correct reconstruction value of your home is to make sure that you are not over or under insured.   Having the correct value of your home will be beneficial at the time of a loss.

As the years go by, and the longer you live in your home, the more enhancements you tend to make. Many don’t realize that when enhancements are made they need to be reported to their insurance agent to keep there insurance value up to date.  If you have any questions on insurance home valuation please feel free to contact me!