How Much Home Fire Insurance Coverage Do You Need?
Home insurance dwelling coverage should reflect the cost to rebuild your home from the ground up — not its market value, which includes land. US construction costs typically range from $100 to $300+ per square foot depending on your location, construction type, and finishes. Underinsuring your home can trigger a co-insurance clause that reduces your claim payout proportionally if you are below 80% of the rebuild value.
This calculator estimates your dwelling rebuild cost based on home size, type, and age — applying a 2% annual depreciation up to 50% — plus a recommended personal property coverage amount at 70% of your stated belongings value. Use it as a starting benchmark when reviewing your homeowner's or renter's insurance policy.
For the most accurate coverage, get a replacement cost estimate from a licensed appraiser or ask your insurer to run an automated rebuild cost estimate for your property. Also consider additional coverages like additional living expenses (ALE), liability protection, and umbrella coverage to round out your policy.
Frequently Asked Questions
Always insure for rebuild cost, not market value. Land is not at risk from fire, so insuring for the full market value leads to overpaying for coverage you don't need.
Insurers typically require you to carry at least 80% of rebuild cost as dwelling coverage. Below this, your claim payout is reduced by the shortfall percentage.