Personal Lines

Providing property and liability insurance coverage for individuals who own a home, own a secondary residence or rentals.

The Truth About Homeowner Extended Replacement Cost 

Many people believe that it is acceptable to under insure the dwelling coverage on their homeowners policy because they have an endorsement for an additional 25% or 50% extended replacement cost. Think Again. In California, most homeowners insurance policies will have provisions in them with respect to the extended replacement cost coverage. In order for this coverage to be in place, the insurance company can require that you are insuring your home at least to the rebuilt cost of the home at the time of the policy period. In the event that you are not, your extended replacement cost coverage could be void or you could find yourself in a position of coinsuring your home based upon the percentage of rebuild cost. Many people attempt to keep lower than necessary coverage on their homeowners insurance in order to lower the premium. In the end, it just is not worth it. The difference in premium from a properly rated policy to a policy that is underinsured is minimal. If you are looking to ensure that you have a good rate on your homeowners insurance, let California Mutual Insurance give you a quote.