Buy Coverage That Absorbs a Spike in Home Repair Costs

A surge in home construction prices has been an ongoing story from 2021. A pandemic-induced supply chain disruption, inflation and labor shortages have contributed to a 15-year high for home construction backlog. While housing construction activity is expected to be bogged down in the short-term, there is some optimism for a return to normalcy later in 2022.

As a homeowner, it’s worth reflecting what a spike in construction costs could mean for you. If a problem like a natural disaster or fire destroys all or part of your home, your bank account could also take a serious wallop without the right level of coverage.

The dwelling coverage within a home insurance policy pays to repair or rebuild your home if it’s damaged by a problem covered by the policy, like a house fire.

Your dwelling coverage amount should be based on what it would cost to rebuild your home based on the local construction and labor costs. But certain situations, like a tornado that flattens entire neighborhoods, can cause a spike in rebuilding costs. Suddenly your dwelling coverage amount could be insufficient.

Fortunately, some insurers offer home insurance with extended or guaranteed replacement cost. These optional coverage types absorb a spike in construction costs by adding extra coverage to your dwelling insurance limits when needed.

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5950 Berkshire Lane, Suite 100, Dallas, TX 75225
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