Home Insurance discounts and questions

Enough to rebuild the house at today's construction cost, not what it would sell for. Land is not insured, and market value includes it. Carriers run a reconstruction estimator from the square footage, finishes and construction type; ask to see the inputs, because a wrong square footage or a missing basement is the usual reason the limit is short.

Suppose a house would sell for $500,000 and the lot alone is worth $150,000. The dwelling limit should track the $350,000 rebuild plus an extended replacement cushion for the price surge after a regional storm, and it should be adjusted upward when you remodel.

Wind, hail and lightning are covered perils, so a roof stripped by a microburst or dented by hail is a claim, subject to the wind and hail deductible. Rain that enters through the opening the wind made is covered too. Water that rises from the street or a wash and comes in at ground level is flood, which the policy excludes and a flood policy covers. Dust from a haboob that gets in through closed windows is generally not a covered loss unless a covered peril made the opening.

Hail losses in the Southwest have made the roof the single most scrutinized part of the house. Carriers now ask its age at every renewal, may inspect it from the air, and can move an older roof to actual cash value settlement, add a roof schedule, or decline to renew. Replacing the roof before the carrier forces the issue usually costs less than the premium and settlement changes that follow, and it earns a discount on the new policy.

Fire is a covered peril, including wildfire, and loss of use pays while an evacuation order keeps you out. The difficulty is not the coverage but the availability: carriers score every address on wildfire exposure, and a house at the urban edge in Prescott, Flagstaff, the Wasatch foothills or the Boise foothills can be non-renewed or declined on that score alone. Defensible space, a non-combustible roof and ember-resistant vents improve the score with some carriers, and where the standard market will not write the house there are last-resort options that vary by state.

Actual cash value is what the item was worth used, which for a ten-year-old sofa or roof is a small share of what a new one costs. Replacement cost pays what it costs to buy new, but many policies pay the depreciated amount first and release the balance when you show you replaced the item. The choice can apply separately to the dwelling, the roof and the contents, so a policy can be replacement cost on the house and actual cash value on the roof at the same time.

Personal property is covered off the premises, usually at a fraction of the contents limit, and that extends to a storage unit and to a student living in a dorm. A student in an off-campus apartment is often treated as living elsewhere and needs a renters policy. Theft from a storage unit is covered but the unit's own insurance requirement is usually satisfied by naming it on a certificate, which we can issue.