The aftermath of a loss is the worst possible time to find out a property is underinsured, yet many homeowners are in this predicament following the record-breaking 2011 severe thunderstorm season.

Many factors can lead to an underinsured home, but in the end, homeowners are responsible for having adequate insurance coverage. Typically, insurance agents will help homeowners by estimating replacement costs for their homes. In some areas, it has become increasingly common for those replacement costs to exceed a home's market value, often challenging the agent to explain the importance of insuring a home to its full replacement value.

For most homeowners, the risk of not insuring the property to its full replacement value is too great. Here are three strategies agents can use to help ensure that a homeowner's insurance coverage reflects real replacement costs independent of the home's market value.

Recommended For You

Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader

Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
  • Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
NOT FOR REPRINT

© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.