How to Estimate What Insurance Costs Will Be on a Home

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Your home insurance is defined primarily on the replacement cost of value. Estimate what insurance costs will be on your home insurance with help from a public insurance adjuster in this free video clip.

Part of the Video Series: Home & Business Insurance
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Video Transcript

Hi, I'm Dan Odess. I'm a Licensed Public Insurance Adjuster, and I'm here to talk to you about how to estimate your cost of your home insurance. Your home insurance is determined primarily on the replacement cost of value, that is the fair market value of the cost of material labors in the event of a loss. They take into consideration a lot of different things such as fluctuations in the market, large storm events, things like that which might cause an increase in the cost of construction or there might be situations where it causes a decrease in the cost of that construction. With all things said, one of the best things you might be able to do is hire a licensed, that is a licensed home inspector to come in and do an evaluation of your property at the time of placing that insurance to get the proper discounts or whatever maybe afforded to you while placing that. They can help you determine sometimes the actual replacement cost value of a policy or give you kind of an idea or a ballpark as to how much it's going to be. Your rates for which what is the cost of your insurance on either a monthly, a quarterly, six month basis or a one time payment is a direct percentage of the total amount of the coverage that is afforded to you. Those coverages show up on what's called a declaration page so it's an important thing to review there. So one of the things you've got to take into account is what is it going to cost you at any given period of time in the next year to rebuild in event of that loss. That value is your replacement cost value. That value will be directly reflected as a percentage in your rate, in your premium dollars. So make sure that replacement cost value or the contents coverage loss of use, coverage A, B, C, D, or all the other coverages that you might have on your policy are properly assessed and properly associated with the actual costs. Based on those values will determine the rate in which you pay. Some things you might take into account is legislation changes, cost of construction, building code changes, all those things will affect that premium dollar that you're paying. Thanks again, this was Dan for eHow.


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