Home Insurance in Hamden 

Insuring your home has never been so complicated.  Inflation has building costs soaring and market prices of homes are at records highs.  According to CoreLogic, US home prices increased 20% in February 2022 from only the year prior.  The everyday consumer is left wondering what changes, if any they should be making to their home insurance.  

During the pandemic, supply chain issues caused building costs to skyrocket, both because of material and labor shortages.  At the same time, many parts of the country saw a mass exodus from cities.  Crowded spaces and work-from-home arrangements drove many to look for permanent residence in the suburbs, which drove up the price of real estate in many suburban areas.  So, for many who are reading this, your home is not only worth more in terms of a potential sale price but also, it will cost more in this current environment to replace.  For the purpose of your home insurance, the more relevant factor is your replacement cost.  Your home insurance policy is based upon how much it would cost to replace your home in the event of a partial or total loss.  Therefore, if the current economic environment has driven up the cost to build, or in the case of an insurance claim “re-build”, the insured should review their current replacement cost limit on their policy with their insurance agent.  

Review your Replacement Cost

Home insurance in Hamden is no different than any other town or city in the US right now.  Residents in Hamden are certainly not “immune” to this symptom of the current economic environment.  Unfortunately, there is nothing the insured can do to combat the current economic environment other than prepare themselves for the changes it brings.  Your insurance agent can discuss multiple options with you regarding the replacement cost limit on your policy.  The first would be updating your cost estimate of your coverage A to review the limit itself.  This may result in a higher replacement cost.  Your agent could also look into your” additional replacement cost coverage” which is often sold in terms of a percentage.  The coverage increases your replacement cost amount by either 25%, 50% or even 100%.  A handful of carriers, some of whom we represent, also offer a coverage called “guaranteed replacement cost” which guarantees the replacement cost (certain conditions must be met).    

Have a Conversation with your Agent

At Street Smart we’ve had these conversations already with many of our insureds.  Many of them who purchased home insurance in Hamden several years ago and have not had to change their replacement cost on their homes.  It is normal for insurance companies to put an inflationary increase on policies of between 2-4% annually when offering a customer a home insurance renewal.  And even though many of our insurance companies have increased this inflationary percentage range to on average 6-8%, we’ve found in many cases, customers have decided to increase their replacement costs or purchase additional replacement cost amounts.  

Other Home Insurance Coverages

But what about my other coverages?  Do I need to increase those as well?  Think about your personal property replacement cost and your loss of use.  With inflation at record levels while these are secondary in terms of importance to reviewing your replacement cost, it is a consideration that you would also want to review these coverages as well.  Inflation has caused prices of everyday items to rise, and this includes apartment or home rental if you had to stay elsewhere while your home was being repaired.  Rely on your home insurance agent to be your guide because with most insurance providers, the coverage limits for your personal property and loss of use are increased as your replacement cost is increased.  It is likely that if your agent reviews and increases your replacement cost, that these coverages will automatically increase as well.  

Reach Out to Street Smart

If you need assistance acquiring home insurance in Hamden or want to discuss your replacement cost further, please reach out to Street Smart at 203-281-6835 or start your quote now.