insure logo

Why you can trust

quality icon

Quality Verified

At, we are committed to providing the timely, accurate and expert information consumers need to make smart insurance decisions. All our content is written and reviewed by industry professionals and insurance experts. Our team carefully vets our rate data to ensure we only provide reliable and up-to-date insurance pricing. We follow the highest editorial standards. Our content is based solely on objective research and data gathering. We maintain strict editorial independence to ensure unbiased coverage of the insurance industry.

Forget real estate market value. Insurance value is all about construction costs.

In some cases the cost to rebuild might exceed the resale value of your home, especially in a depressed housing market when construction materials and labor costs remain stable as housing prices decline. In other cases, the cost to rebuild your home might be below its market value. The real estate value, after all, includes the land, which isn’t factored into the cost to replace the building.

Your insurance agent should be able to provide guidance on the appropriate coverage amount.

Many victims of disasters find out too late that their homes were underinsured. Among victims of the 2010 Fourmile Canyon wildfire near Boulder, Colo., 64 percent of homeowners reported being underinsured on their dwelling by an average of $200,000, according to a survey by United Policyholders, a consumer advocacy group.

See When your home’s market value is less than its insurance value.