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Is Your House Properly Insured?

It is important to make sure your house is properly insured to protect yourself from financial loss if something were to occur that leaves your property damaged. After all, the entire purpose of home insurance is to protect you, the homeowner, from financial loss to damaged or lost property. 

Reviewing the different types of coverages

There are different types of coverages as it pertains to home insurance. The type of coverage you receive dictates how much the provider will cover for damaged and lost property. The most notable types of coverages include:

  • Replacement cost – This coverage pays for the full replacement of any damage with the same level of quality and kind of materials. It does not factor in depreciation. 
  • Actual cash value – This coverage provides the homeowner with an actual cash value based on the worth of the damaged or lost property as is, and it does take depreciation into consideration.


Of course, replacement cost coverage likely comes with higher premiums, but it helps ensure your home is properly insured. Standard home insurance policies do not cover natural disasters. To fully insure your home, consider an add-on policy for flood and earthquake insurance, along with water back-up and other types of additional coverages. 

How to ensure your home is properly insured

You should always ensure your home is properly insured before beginning (or continuing) any home insurance policy. Otherwise, you could be liable for high out-of-pocket costs if your property is damaged or lost. There are online calculators to help you determine your home’s replacement cost value and ensure you are properly covered. It is also important to understand any limits placed on your policy. Based on your home’s replacement cost value, you can negotiate better terms of your home insurance policy, if necessary. 

The factors that determine your home replacement cost

It is crucial to understand how your home insurance provider will calculate your home replacement cost value. This should give you a good indication of the extent of your coverage. The most notable factors that determine your home replacement cost includes:


  • Square footage (size)
  • Number of rooms
  • Construction costs
  • Type of home exterior
  • The style of your home
  • Roof type and condition


Be sure to make note of all of these factors when discussing your policy with your home insurance provider. You may also need these details for the cost analysis when determining your home’s replacement cost value. If there are any disparities between your cost analysis and the coverage your policy dictates, then address the issue with your provider. If you are unable to secure the ideal coverage, then you may want to consider switching your insurance provider. 

Final thoughts

Your home insurance policy should make you feel secure living in your home, knowing that you are covered financially if anything disastrous were to occur. By determining your coverage type and conducting a cost analysis to see if you are properly insured based on replacement cost value, you can protect yourself and ensure your policy provides the coverage you need.


EXIT Realty Bob Lamb & Associates is Murfreesboro’s most innovative real estate team.

EXIT Realty Bob Lamb & Associates
2630 Memorial Blvd, Murfreesboro, TN 37129

(615) 896-5656

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Our agents write often to give you the latest insights on owning a home or property in the local area.