Home Insurance and Property Taxes

Question: My tax statement lists TAXABLE value of $231,000 and MARKET value of $235,000, but my insurance policy shows a dwelling amount of $263,000. Why is my home insured for more than it’s worth?

Answer: Mike Honea Agency uses an approved Replacement Cost Estimator which uses the data from the Central Appraisal District to determine the cost of replacing your home (including labor, materials & debris removal) at today’s prices. The replacement cost estimator not only takes into account the number of bedrooms & bathrooms and square footage, but also factors in the finishes in your home. For example – Do you have builder’s grade cabinets or custom cabinets? Are your countertops laminate or granite? Are your floors wood, laminate, carpet or tile? Each of these impacts the cost to rebuild your home – and that is what you are insuring, the ability to rebuild your home. The insurance companies use the information provided by the replacement cost estimator to help guarantee that your home could be rebuilt with the fixtures and finishes that you currently have. If after considering this information you feel that your home is over insured or under insured, please contact the office. We can go through the items on the replacement cost estimator with you to verify that the most accurate information has been used.

Do you have an insurance question you would like for Mike to answer? Email your questions to Rachel@honeainsurance.com .