How Much Home Insurance Do I Need?
Getting the right amount of home insurance is critical — too little and you're underinsured; too much and you're overpaying. Here's how to determine the right coverage amount.
Insure for Replacement Cost, Not Market Value
Your home insurance should be based on the cost to rebuild your home — not its market value or what you paid for it. Rebuilding costs depend on local labor rates, materials, and the size and features of your home. In West Virginia, rebuilding costs can be significantly different from market value.
How to Estimate Your Home's Replacement Cost
A rough estimate is to multiply your home's square footage by local construction costs per square foot. In West Virginia, this typically ranges from $100–$200 per square foot depending on the type of construction and finishes. Your insurance agent can help you calculate a more accurate replacement cost estimate.
Personal Property Coverage Amount
Personal property coverage is typically 50–70% of your dwelling coverage. Take a home inventory to estimate the value of your belongings. High-value items like jewelry, art, or collectibles may need a separate scheduled personal property endorsement.
Liability Coverage Recommendation
Most homeowners should carry at least $300,000 in liability coverage. If you have significant assets, consider an umbrella policy for an additional $1 million or more in liability protection at a relatively low cost.
Review Your Coverage Annually
Home values and construction costs change over time. Review your home insurance coverage every year — especially after renovations, additions, or major purchases — to make sure you're not underinsured. AG Insurance offers free annual policy reviews.
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