Homeowners nationwide face increased home insurance bills regardless of their company. If your home insurance renewal is higher than the last year, you’re not alone.
What is causing this cost increase?
Rebuilding is more expensive now than when you purchased your policy due to the rise in construction costs. This is not because you changed anything. The costs of construction materials have increased dramatically since the pandemic.
Because of this, the limit on your homeowner’s insurance may be increased by your insurance company. The limit is coverage is Coverage A on a policy. It protects your house and attached structures, such as attached garage, breezeway, or deck.
The insurance company agrees to cover a claim for the cost of rebuilding up to the limit of your policy. Since the costs of lumber and construction materials have increased tremendously, the cost to rebuild your house may exceed the amount of your Coverage A limit. This is the reason some insurance companies are increasing your dwelling limit at renewal.
How big of an increase should I expect to see on my bill?
Every rebuild situation is unique, so there is no exact dollar amount of increase. A few things that will influence the amount of increase you experience include:
Where you live
Home remodeling projects
Larger home improvement projects
Other physical changes to your house that may impact the value
What should I do to make sure I have enough coverage?
Contact your insurance agent to review your insurance policy coverage limits, as well as discuss any changes or improvements you have made to your home. This will help determine if your dwelling limit needs to be increased.
Source: Auto Owners Insurance
