To get a quote, all of the companies are asking for the replacement cost. I've read that only way to get that is to hire an appraiser.
So does that mean I get an appraiser first, THEN start getting insurance quotes?
What do I do here?How do I determine my house's replacement cost to get an accurate quote from insurance companies?Well...a decent insurance agent should be able to tell you the average replacement cost in your area based upon a price per square foot value. Some companies will even have tools to input data about your home and come up with an estimated replacement cost...although these figures can tend to be out of date. If you want a true cost replacement value, you pretty much have to shell out around $300 for an appraisal or hire a contractor to give you an estimate.
But if your home is of average quality for your community, the figure your agent provides should be pretty good. For example, in my area the average replacement cost is around $175-$200 per square foot. So if you have an average house that is 1500 sq feet, you would probably be looking at $300,000 in coverage. The cost per square foot estimate came directly from our Total Loss Adjusters...their entire job is rebuilding people's burnt down houses. Now, if you have marble countertops and hardwood floors throughout, we'd want to raise that figure accordingly, to maybe $225-$250 per square foot.
Ask a local agent for their input...if they are worth a darn they should have an average estimate for you. If you want a figure based upon your exact house...pay for an appraisal.
EDIT:
Ignore the person who asked for your purchase price. Purchase price has absolutely no bearing on the replacement cost. Replacement cost is what it would cost to rebuild the house from scratch if it burned to the ground. Purchase price is influenced by many factors that don't impact replacement cost (market conditions, size of the lot, if it's in a desirable neighborhood or not, etc).How do I determine my house's replacement cost to get an accurate quote from insurance companies?I am an insurance agent, and every carrier has a program that will estimate the replacement cost of your home based on construction type, square footage, and general attributes of the home (i.e. number of baths, fireplaces, etc). there really is no reason why the company cannot provide you with an estimated replacement cost. Some carriers will even send an appraiser out to inspect the home once the policy is issued to make sure the replacement cost calculated is accurate. I see no reason why they cannot do that for you.How do I determine my house's replacement cost to get an accurate quote from insurance companies?Nope, you really have to rely on the agent.
Each company can use different criteria, for determining the replacement cost. If you hire an appraiser, 1. it's going to cost you and 2. it's not binding with the insurance company.
Your best bet, is to go to a local, independent agent. Part of THEIR JOB, in writing your policy, is to ask you a whole bunch of questions, and calculate the replacement cost of your house, with each carrier that they quote you with.
Generally, though, it's going to run around $200 to $300 per square foot.How do I determine my house's replacement cost to get an accurate quote from insurance companies?Ok, you can skin this cat several ways and still end up in the same place.
First, you can ballpark what you purchased the house for, which would give you a general area and then pull out the amount for the lot. That is one way to get an idea.
Next, you can have your insurance company give you an idea based on square footage, amenities and other items and then you can decide if your above or below average amenities. Being honest about the amenities could significantly effect the value you put on your home.
Finally, you can talk with a home builder or inspector. Likely they would charge you for your piece of mind on the policy. Most new constructions in my area for average home would run about $120-$140 a square foot. This range home would be between the $125K - $225K or slightly more. The higher the value, you might be a little more above the $140 sf.
Keep in mind, no matter how much value you put on your home if you had laminated countertops then that is what they would go back with regardless if you had $1M dollars worth of coverage. Your policy shoudl have an inflation index that will keep your policy up to date. Also, you're agent can put an endorsement on the policy that could provide up to 20% additional coverage if you shortfall on your base value.How do I determine my house's replacement cost to get an accurate quote from insurance companies?Your insurance company should have a program similar to an appraiser. It determine the replacement value of your home based on some particulars. If they don't you can call a local home builder and ask what they charge per square foot to build a home currently. For example on the east coast it is approx $160 - $180 per square foot to build a home. If your home is 2000 square feet @ $160 per square foot it would be approx $320,000.How do I determine my house's replacement cost to get an accurate quote from insurance companies?First, I don't know where you live but, most insurance companies will have their own person go to your home and obtain square footage which they use to calculate the amount they will cover you for so, I suggest that you take the price you bought the home for and do not get anything less than that amount. Replacement costs means they will pay to replace it as it was (do not get actual cash value as you get behind the eight ball if something happens- actual cash value sucks!)
I hope this helps and I wish I knew what you paid for your home which then I could help you a little better.How do I determine my house's replacement cost to get an accurate quote from insurance companies?If agencies are asking you for the replacement cost (RC) they are trying to take the easy way out and just quote a number. I'd recommend finding another broker who will help you determine the RC using a cost estimator, then working with them. A good broker will put the time in to give you the correct coverage.
