Figuring Replacement Costs on a Home

It's important to have your house insured based on replacement cost. Shutterstock

Nobody wants to think about their home being destroyed. But disasters can and will still happen even if you’re not living in a hurricane prone area or a fire zone. That’s why it’s important to have your house insured based on replacement cost.

There are different types of replacement costs. But what exactly is the replacement cost, and how do you ensure your home is adequately insured to rebuild your home?

What Replacement Cost Entails

When your house is destroyed, the replacement cost is the total expense involved in rebuilding your home to its original state. This includes using the same materials and craftsmanship of like and quality.