Question 1

Should I insure my home for market value or rebuild cost?

Accepted Answer

Homeowners insurance should be based on rebuild (replacement) cost — what it would take to rebuild the structure — not the market or sale price, which includes land value. Insuring to market value can leave you underinsured or overpaying.

Question 2

Do I still need home insurance if I bought my house with cash?

Accepted Answer

It is not legally required without a mortgage, but going without it means you would pay entirely out of pocket for fire, storm, theft, or liability losses. Most owners keep coverage to protect their largest asset.

Question 3

How do I insure a home I am building myself?

Accepted Answer

A home under construction is typically covered by a builder’s risk or a dwelling-under-construction policy, which protects materials and the structure during the build. You then convert to a standard homeowners policy once it is complete and occupied.

Question 4

What is dwelling coverage and how much do I need?

Accepted Answer

Dwelling coverage (Coverage A) pays to repair or rebuild your home’s structure after a covered loss. Set it to your full rebuild cost — local construction cost per square foot times your home’s size — not the market price. Many policies also add an extended or guaranteed replacement-cost option to cover rebuild-cost spikes.

Question 5

What does a standard homeowners policy not cover?

Accepted Answer

Common exclusions include flood, earthquake, normal wear and tear, pest damage, and sewer backup. Flood and earthquake need separate policies or endorsements, and sewer backup is often a low-cost add-on. Always read your exclusions.

Question 6

How does my deductible affect my home insurance premium?

Accepted Answer

A higher deductible lowers your premium because you absorb more of a small claim. Going from a $1,000 to a $2,500 or $5,000 deductible can noticeably cut cost — just keep that amount in savings. Many coastal states also apply a separate percentage-based hurricane or wind deductible.

Question 7

Does home insurance cover my roof?

Accepted Answer

Yes, for sudden covered perils like storms or fire, though older roofs may be settled at actual cash value (depreciated) rather than replacement cost. Some carriers offer better roof replacement endorsements. Routine age-related wear is not covered.

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