Monthly Archives: May 2014

Home Insurance Value

How Much Coverage do I Need to Rebuild My Home?

Imagine how devastating it would be to lose your home in a fire.  Now imagine having to chip in $30,000 from your own pocket to be able to rebuild it completely because you didn’t have the correct amount of insurance.

Selecting the proper amount of coverage is one of the most important decisions you can make with your homeowners insurance policy.  Without proper limits, you may not have enough coverage to rebuild after a total loss.  You want to make sure that the amount of the insurance on your home is equal to the reconstruction value.  This is called “insurance to value.”  Below are some explanations and tips to help you make the right choices for your needs — and remember, if you need help, we’re just a phone call away (414-744-6614)!

What is insurance to value?

Insurance to value is the relationship between the amount of coverage selected (typically listed as “Coverage A” or “Dwelling Coverage” on your policy declarations page) and the amount required to rebuild your home – simply put, Coverage vs Reconstruction Value.  Insuring your home for anything less than 100% insurance to reconstruction value could mean you wouldn’t have enough coverage to replace your home in the event of a total loss.  At the Insurance Center of Milwaukee, we have access to a computer program (that is updated quarterly) to help determine the proper amount of insurance for your house located anywhere in Wisconsin!

Why is the cost to rebuild different from the market value?

A home’s market value reflects current economic conditions, school districts, the value and location of the land, and other factors unrelated to reconstruction cost.  The cost to rebuild your home is based only on the cost of materials and labor in your area.  Think of it this way – where ever you build a 1500 square foot home in SE Wisconsin (Milwaukee, Oak Creek, Greenfield, Shorewood, etc.), it will cost about the same for the labor and materials even though the market value could be drastically different.  That is why it is important that you insure your home based on its reconstruction cost, NOT its current market value.

Why is reconstruction more expensive than new construction?

New home builders typically build many homes at once, and solicit bids from various sub-contractors to receive the best pricing. Their business model is based on economies of scale. For example, they may purchase 100 windows at one time, securing a lower “per window” cost. These economies of scale don’t exist when building (or rebuilding) a single home.  During reconstruction the contractor has to be careful not to damage the existing landscaping and may have to work around features in the interior of the house as well.

How can I make sure I have the correct amount of insurance?

Provide detailed information at time of purchase to be sure that you receive a thorough and accurate quote and don’t forget to tell your agent about any changes or improvements that you make to your home.

Mother’s Day

Celebrating mothers

 As the second Sunday of May nears, it’s time to think of ways to celebrate mothers. Of course, that’s a worthy pursuit at any time of year!

At the Insurance Center of Milwaukee, we thought it would be fun to provide a little history of Mother’s Day, as well as a few ideas to honor the special women in all of our lives.

Ancient beginnings

According to MothersDayCentral.com, the ancient Egyptians held an annual festival to honor “the mother of the pharaohs” – the goddess Isis.  This is one of the earliest historical records of a society celebrating a mother.

Mother’s Day in the U.S.

In 1908, Anna Jarvis of West Virginia, decided she wanted to accomplish her mother’s dream of a celebration of all mothers.  By 1909, more than 40 states were holding Mother’s Day services – even though it was not a national holiday.  In 1912, according to Wikipedia, West Virginia was the first state to officially observe Mother’s Day.  Jarvis continued to promote the day until President Woodrow Wilson made it an official national holiday in 1914.

She later regretted creating the holiday, believing that it had become too commercialized.

Enough with the history – where are the gift ideas?

At the Insurance Center of Milwaukee, we know you might have more urgent concerns on your mind, like last-minute shopping, so here are the most popular Mother’s Day gifts, according to MothersDayCentral.com:

Flowers, Gift baskets, Personalized gifts, Jewelry, Perfume, Spa gifts, Magazines

Of course, the BEST gift of all is getting in touch and letting the moms in your life know just how much they mean to you.  Oh, and don’t forget, if you get jewelry for your mom, remind her to get it insured!  Happy Mother’s Day!