Protect Your Assets: How Much Home Insurance Do You Need?

For the majority of us, a house is the single largest investment that one will ever make. Unlike other assets, like clothes, appliances and cars, a house appreciates over time, therefore it would behoove you to ensure that it has maximum insurance protection at all times.

The question is, how do you quantify sufficient insurance? It is recommended by that you follow the three simple guidelines to at least ensure minimum coverage:

1. Make sure you have enough insurance to cover the cost of rebuilding your house at current construction costs. To figure out the amount of coverage needed, take the total square footage of the house and multiply by current local rebuilding costs per square foot. For example: A 2,000-square-foot home with local rebuilding costs of $150 per square foot (2,000 * 150) comes to $300,000 of dwelling coverage.

2. Make sure that your personal possessions are properly covered. We recommend that personal possessions be insured at replacement cost not actual cash value.

Most homeowner policies will also provide coverage for loss of use. This means that if you need to live somewhere else while the house is being restored, the insurance company will pay for this expense.

3. Liability coverage is also included in most homeowners policies. This is very important. The minimum on most policies is $100,000. We recommend at least $300,000.

In addition to the coverages mentioned, there are many other coverages to consider depending on the type of house, the contents in the house and any other structures located on the property. We recommend a review of your coverages be handled by a local insurance professional.

Terry Shropshire
Terry Shropshire

A military veteran and Buckeye State native, I've written for the likes of the Atlanta Journal-Constitution, Atlanta Business Chronicle and the Detroit Free Press. I'm a lover of words, photography, books, travel, animals and The Ohio State Buckeyes. #GoBucks

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