Hello, I am in the process of purchasing a home, I’ve been shopping around a lot for insurance as rates are much higher than expected.
I found a great rate with a well known insurance agency, but the Dwelling coverage to rebuild the home is only ~89% of the sale price of the home at closing. The home is older (1930’s), so the insurance company said they use a different algorithm to determine the coverage due to the property’s age.
It’s worth mentioning that I will be putting 20% down on the home, so the dwelling coverage will be more than my mortgage, but looking to know if I’m taking on extra risk here by not having coverage of at least my home’s sale price.
There is also an additional structure on the property, my other structure coverage is about 9% of the total purchase price, so A and B coverages combined are ~98% of the purchase price of the home.
I figure I’ll hold this policy until closing which is quickly approaching, but should I be biting the bullet and accepting a (much) higher premium for more coverage? Most of the quotes I’ve received are between 20-60% higher than the premium for this policy, even with higher wind/hail deductibles than this current policy.