Understanding Your Home's Replacement Cost

Consider your home's unique features when establishing insured value.

When you’re buying homeowner insurance, how do you determine the replacement cost of your home? Homeowners often think replacement cost is the same as the current market value of the home. Unfortunately, that method could leave you with unpleasant surprises if you have a loss. Your insurance agent can use cost estimator tools to complete a value for you.

Questions that will help your agent determine an accurate suggested value for your home: 

Was your home built in 1944 or earlier?

Let your agent know if your home is a registered historical home or if your home has a name plate or plaque. Additionally, mention if your home is located in a historic district.

Have you completed any renovations on the home?

Provide date completed, details of renovations and costs.

What is the square footage of the total living area?

Share your bank appraisal or prior inspection report with the agent. If you don’t have a report, your agent can check your county tax card for square footage.

What type of foundation is under your home?

Is it slab, crawl space or basement? If basement, is it a walk-out? What percentage is finished?

Do you have a garage attached to the home?

If yes, how many cars can it hold?

Do you have any additional spaces?

Include any half story, three-quarter story, screened or covered/enclosed porches, deck, outdoor kitchen or any other attached structures.

What are the exterior features of the home?

Consider roof material (shingle, concrete tile, slate); primary exterior wall covering (brick, vinyl siding, wood frame); and style of home (ranch, bi-level, colonial)

What are the interior features?

• Window styles and brand (casement, double slide, transom)
• Floor coverings (wood, carpet, tile)
• Ceiling construction (standard, coffered, beamed, vaulted)
• Wall trim (crown molding, pilasters, custom molding, arched doorways)
• Kitchen cabinetry, countertops, backsplashes, high-end or luxury brand appliances
• Bathroom cabinetry, countertops, flooring
• Any rooms with built-in cabinetry
• Number of fireplaces
• Miscellaneous items (wet bar, ceiling fans, solar panels, walk-in closets, wine cellar)
• Unique items

Give your insurance agent as much information as possible, including pictures or videos of your home. They can then estimate how much it would cost to replace your home.

When you buy a new homeowners policy, the company may send someone to assess the cost of replacing your home. The appraisal process is typically quick and non-invasive. They'll confirm the replacement cost estimate and document your home's features. This gives you added comfort, knowing that your home is insured to the correct value.

Remember to review your homeowner's insurance policy regularly to make sure you have enough coverage. This is especially important if you do renovations or large remodeling projects.

This loss control information is advisory only. Not all exposures are in this article. Contact your local, independent agent for insurance coverage advice and loss control information. Neither The Cincinnati Insurance Company nor its affiliates or representatives offer legal advice. Consult with your attorney about your specific situation.

The selection of a particular service provider is the independent choice of the policyholder. Service providers are not affiliated with The Cincinnati Insurance Companies. Cincinnati and its employees make no warranties and assume no liability for services, products or loss control measures provided by service providers.