Tennessee
My home was appraised for $155,000 two years ago (not a tax appraisal, a real appraisal for a refi). I would expect that the value might be a little less now given our current market. I opened a new homeowners policy with Geico last year. Dwelling coverage was $160,000 and my annual premium was $621. I have always been told that you only need to insure the dwelling for 80% of your appraised value. So I have always figured I was over insured and I guess that made me feel "safe". I recently got a renewal statement from Geico and they automatically raised my dwelling coverage to $221,000. First, I called my mortgage lender to find out what their minimum was, and what their opinion was on my current coverage. They told me that their minimum was $110,000, and that $160,000 was a sufficient amount of coverage. So then I called Geico. I told them that I did not want my amounts increased and would they please lower my amounts back to where they were. At that time the CSR did a lengthy "cost to rebuild analysis" on my home and came to the same number....$221,000!. To which I replied..."I don't care, I just want to be covered for $160." She then informed me that unfortunately, $221,000 was the lowest amount of coverage they would sell me. Can anyone please explain this to me? Wow......the housing/construction market must be a lot worse than I thought if the cost to rebuild a small home with a total appraised value of less than $155,000, will actually cost $220,000. Is it THAT dire?
My home was appraised for $155,000 two years ago (not a tax appraisal, a real appraisal for a refi). I would expect that the value might be a little less now given our current market. I opened a new homeowners policy with Geico last year. Dwelling coverage was $160,000 and my annual premium was $621. I have always been told that you only need to insure the dwelling for 80% of your appraised value. So I have always figured I was over insured and I guess that made me feel "safe". I recently got a renewal statement from Geico and they automatically raised my dwelling coverage to $221,000. First, I called my mortgage lender to find out what their minimum was, and what their opinion was on my current coverage. They told me that their minimum was $110,000, and that $160,000 was a sufficient amount of coverage. So then I called Geico. I told them that I did not want my amounts increased and would they please lower my amounts back to where they were. At that time the CSR did a lengthy "cost to rebuild analysis" on my home and came to the same number....$221,000!. To which I replied..."I don't care, I just want to be covered for $160." She then informed me that unfortunately, $221,000 was the lowest amount of coverage they would sell me. Can anyone please explain this to me? Wow......the housing/construction market must be a lot worse than I thought if the cost to rebuild a small home with a total appraised value of less than $155,000, will actually cost $220,000. Is it THAT dire?