The Impact of Your Home’s Age on Insurance Costs

Your home requires robust financial protection, as even the most diligent maintenance and steadfast fortifications may not be able to stave off all losses. Unfortunately, regardless of your efforts, repairs, renovations and rebuilding may eventually be necessary. Insurance carriers are well aware of this inconvenient truth, but by working with a qualified agent, you can still find the best available rate without sacrificing coverage. Understanding the subject is key.

How Does a Home’s Age Impact Insurance Costs?

You should first understand that not every aspect of your home will be treated in the same way. For example, an older roof may be more problematic in the eyes of insurers than an aged refrigerator. Of course, you’ll need to discuss exact parameters with your carrier to understand how various aspects of your home might affect your home insurance premiums.

What Are Replacement and Actual Cash Value Coverages?

One of the key distinctions in home insurance policies is replacement cost vs. actual cash value (ACV) coverage. While the former can provide greater financial protection, it often entails higher premiums; the latter typically incurs lower costs until you need to make a claim. Consider the following specific examples:

• If your home is older, you might need to pay more for coverage because replacement cost coverage would mean fully repairing or rebuilding your home despite it being at greater risk.

• If your home is relatively new and at lesser risk of total loss, you might opt for actual cash value coverage, as you’re less likely to suffer a total loss due to your home’s advanced safety features and structural integrity.

We’re Here to Help

If your home is older, you’ll generally need to pay more for the same coverage due to increased insurer risk. Still, taking ample precautions and addressing potential concerns can help you retain appropriate coverage at an ideal rate.

Contact the Jack L. Bonus Insurance Agency today to discuss your coverage options.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.