Your Home Might Cost More to Replace than You Think

October 15, 2014

home replacement cost

Image courtesy of stuartmiles/

Your homeowners insurance policy is there for you to rebuild at today’s construction costs if you experience a serious fire, wind damage, or other covered loss.

Actually, here at Scalzo, Zogby & Wittig, we’ve had more catastrophic wind claims in the last year or so than ever before. Our extreme weather here in Oneida, Herkimer, and Madison Counties has made things difficult, to say the least.

Since we want to pay you to rebuild, estimating the replacement cost and insuring to that value is crucial when it comes to your homeowners insurance.

The problem is that the first thing most people think about when calculating how much their home is worth is its market value. That’s what they see each month with their mortgage payments, their assessment, and the real estate market in their neighborhood.

But you can’t go to a store and replace your family room after the portable electric heater malfunctions and destroys it in a fire. We are here to pay a contractor to rebuild the family room at today’s construction costs. That means that your insurance amount needs to be enough to rebuild, not to sell on the open market.

How Do You Calculate the Replacement Cost for Your Home?

Any one of our Personal Lines Account Managers here at Scalzo, Zogby & Wittig will help you estimate the replacement value of your home. We use a sophisticated software program that factors in all of the labor and material costs you would have to pay to rebuild your house…right down to the built-in fireplace and stately federal door on the front porch.

First, the Home Replacement Cost Basics

We’ll start out asking you the basics: year built, grade of construction, type of house. Is it one, two, or three story, ranch, or split-level? Is the exterior frame or brick and do you have a full basement or just a concrete slab?

Your heating system might be a boiler or forced air. We’re also seeing homes built in New Hartford, Whitesboro, Clinton, and around the Utica area with radiant floor heating, which is more expensive to replace than radiators or floor ducts. And many of our clients have air conditioning for the hot summer months.

Next we’ll talk about the number of full and half bathrooms and whether there are any additional features like sinks, tub/shower surround, or vanity tops. And, with more of our senior citizens living at home, special walk-in tubs.

Then the Specialty and Custom Components and Accessories

Now the fun part as we get to some of the unique built-ins, custom moldings, skylights and more that you’ve either built into the house or that came with it. All of these items would need to be replaced if lost in a fire or other covered loss. They’ll all be figured into the replacement cost of your home.

For example, our clients often invest more in their kitchens. They may have cultured marble counter tops or maybe tile or stainless steel. Many have a built-in center island with cabinets and sinks.

Think also of other features inside your home that add to your enjoyment…and the replacement cost. Features such as window seats, cloth ceilings, custom molding, and fireplaces add up fast.

If fact, at our agency, we have noticed that many of the homes in Utica, New Hartford, or Whitesboro built in the 1920s have higher replacement costs than new homes of larger size! These homes have steel beams in the cellar, glass doorknobs, large fireplaces, and much more that you don’t find very often in today’s new homes.

We actually had a case where the replacement cost of an older home of 1,600 square feet was more than a newer one of 3,000 square feet!

So don’t be surprised that if you own a home in South Utica, for example, that its replacement cost will be much higher than the market value. This means that we’ll recommend insurance on the building that is more than you might think, but certainly adequate if you have a loss.

And lastly, consider the replacement cost of an attached garage, breezeway, or porch as they are included in the Dwelling Coverage on your homeowners insurance policy.

You can get an idea as to your home’s replacement cost by calling any of our Personal Lines Account Managers. We use Replacement Cost Estimators figuring in local construction costs to calculate the right amount of coverage for your home. Just call or stop in for an interview and we’ll take it from there.

After handling insurance claims on homes in Central New York for over 20 years, we know the huge relief our clients feel after a loss when they have the right amount of coverage on their home.

Until next time,

Your SZW Team

Scalzo, Zogby & Wittig, Inc. is your New Hartford area independent insurance agent. Call us for a quote on insurance for your home, car, business, or life at 315.792.0000.