Have Increased Building Costs Put You At Risk of Being Underinsured?
As we are now firmly established in the middle of what is shaping up to be another very busy summer, there is a question each property owner should be asking themselves:
“Will insurance cover all costs to rebuild after suffering a catastrophic loss?”
Causes for concern
- Lumber costs have risen as much as 375% since mid-2019
- The average home built today costs $40,000 more than last year
- Labor shortages and supply-chain shortages have caused unbalanced supply-to-demand issues
- Appraisals older than 18-24 months don’t reflect property value changes
- Policy limits based upon old appraisals only provide coverage based off potentially inaccurate valuation
It is important to know which types of damage your policy covers, excludes or charges a separate deductible for. Familiarize yourself with what type of coverages you have and compare them to your most recent appraisal. If you haven’t had an appraisal within the last year or two, your structure may not be valued properly. Without knowing what it is currently worth, it will be difficult to determine what coverages are appropriate.
We encourage you to contact your agent if you have any questions. As your trusted Reliable advisor, we never sell you unnecessary “add-ons,” but instead make suggestions that put you in the best position possible if any claim occurs.
