Homeowners Insurance: How is the Dwelling Coverage figured?

That's a completely different thing. Market value is what your house is worth on the market if it were to be purchased or you were to purchase it and replacement cost is how much it would cost to rebuild it. So let's dig into replacement cost because replacement cost is really the most important when it comes to homeowners insurance policies. On your best short term home insurance cover, you will see a coverage called dwelling coverage or coverage. This is the estimated replacement cost of your home. It's the amount of money that the insurance company feels it would cost to replace your home and it's the major driver of the price of your insurance policy.

How to Buy Homeowners Insurance

This is the amount you typically have to pay out of pocket toward a covered claim before your insurance coverage kicks in. If you select a lower deductible, you will typically pay less out of pocket toward a covered claim. However, the overall cost of your insurance premium may be higher. On the other hand, if you choose a higher deductible, your out-of-pocket costs will typically be higher – but your premium may be less. Homeowner’s insurance prices can vary because no two policies are alike. Contact a local agent to get a homeowners insurance quote for the coverages that fit your needs.