Q:

What is the replacement cost estimator?

A:

Quick Answer

A replacement cost estimator is a tool used to estimate the cost of replacing a home, according to HomeInsuranceQuotesHomeowners.com. In a situation in which damage to a home is considered a total loss, this tool estimates the cost for rebuilding it.

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Full Answer

Some people use an estimator to help determine the amount of insurance coverage needed for their home. Principal coverage for a home is considered the dwelling or policy limit. Therefore, HomeInsuranceQuotesHomeowners.com advises customers to have adequate dwelling insurance coverage based on current replacement costs. Coverage should not be based on the home's market value or mortgage balance.

An estimation tool typically contains a series of comprehensive questions related to the home's exterior and interior construction, as noted on the Budget Direct website. There are also tools designed to estimate replacement of the home's contents, which are generally insured separately.

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