Do you have enough insurance in New Orleans to rebuild your home?

The rising cost of lumber prices has been well documented this year

When the cost of lumber goes up in New Orleans, the cost to rebuild your home increases

If you don’t have enough insurance to rebuild your home after a devastating loss you could be left going into your bank account to pay a contractor to rebuild



Every New Orleans homeowners insurance policy has an inflation guard endorsement from 1% to usually 4%

Every renewal the insurance company will automatically raise the insured values on the policy up to the %

This is to keep your policy up to date with the rising cost of materials to rebuild

But sometimes if your home insurance policy was not properly reviewed you could be under insured and exposed to a large financial loss

An insurance broker can only use a guide or rule of thumb to determine the replacement cost of your home

An insurance company will have a replacement cost estimator but once again this is a guide

Only a residential homebuilder or contractor will know the cost to rebuild your home using the cost of materials today



If you don’t know a contractor or homebuilder use the price per square foot to determine the insured replacement cost on your homeowners insurance policy

Just a few years ago $100 a square foot was a bottom used on most policies but now you could be closer to $150 a square foot to rebuild

example) 2500 square foot home x $150 = $375,000 cost to rebuildĀ 

Each home is used with different materials so it is best to either have a contractor give you an estimate or just ask him for an average price per square foot using today’s cost of lumber and materials



When is a good time to review your replacement cost of your home?

At each annual renewal is a good time to review the current replacement cost of your home

Over the past year lumber prices have soared due to strong demand and tight supply

Lumber prices were three times higher in September 2020 compared to September 2019

The cost of a 2×4 has gone up 158% and studs have risen 164%

When this happens the cost to rebuild a home increases and maybe your home was insured properly a few years ago it may now be under insured


If you need to review the reconstruction cost of your home and your current homeowners insurance policy with a better insurance broker

give us a call 504.348.3131 or complete the quick form below