Replacement Cost Limits and Inflation


You may have noticed that the dwelling coverage limit on your homeowner’s insurance policy increases a little bit every year. This is due to inflation. Your dwelling limit is calculated based on the size and construction of your home. Increases in costs of materials and labor needed to repair or rebuild in the event of a covered claim are factored into your dwelling limit. The rising inflation in our nation points to rising dwelling limits on our homes as well. It is important to remember that the limit is designed to not only replace your home in the event of a total loss, but also to cover additional things that might be required to rebuild or repair such as debris removal or necessary architectural assessment and design.

A benefit of insurance is that it is designed to account for inflation to ensure that you have adequate coverage in a time of loss.  

If you are worried that your insurance is inadequate, please give us a call. We will help you put together the best package for the best value.


Insurance services provided through Bradshaw & Weil, Inc Insurance & Financial Planning. Any and all other services related to insurance are an outside business activity and are not offered through or supervised by AE Wealth Management, LLC.

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