Building Costs and Your Dwelling Coverage

By |2021-09-04T11:07:33-06:00July 15th, 2021|

construction 2 PB e1626368968663If you have thought about any home improvement projects lately, you have likely noticed the cost of building materials and labor have skyrocketed this past year.  You may have decided to put your project on hold or downsize the scope in order to stay within your original budget.

When you look at the big impact on a small project, you can see quickly see why a complete rebuild would be significantly higher than just a year ago.  Consider these annual price increases State Auto reported for the second quarter of 2021:

  • Lumber     +54.0%
  • Plywood    +42.6%
  • Ready Mix   +3.8%
  • Roofer          +6.0%
  • Plumber       +4.1%
  • Electrician   +4.6%

These trends have been driven by low housing inventory and historic demand, a shortage of skilled labor, and of course, the increase to building materials.  These impact both new builds as well as reconstruction costs after a claim.

All of our insurance carriers use some form of replacement cost estimator when calculating the amount of dwelling coverage for your particular home.  While they are frequently updating the factors used in these calculations, increases are not applied to your policy until the next renewal.  At any time, you are welcome to give our office a call and request a review sooner to make sure you are adequately protected.

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