Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Sep 15, 2020

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As a single homeowner, you need to make sure your homeowner policy provides you with sufficient insurance to cover the replacement cost of your home. Insurance companies vary as to how they determine that, either with a physical inspection of the home, a statement from a contractor, or a computer program used to determine replacement cost. The square footage of the home and the going rate for building in the area are the most common way to determine replacement cost. Also, most insurance companies include an endorsement called extended replacement cost, which provides an additional percentage of the insurance amount in case the amount of insurance is not adequate to rebuild the home. This cushion is very valuable, but you should not use it as a way to reduce the insurance on your home. The homeowner policy is a package that includes personal property as a percentage of the home (usually around 70% of the dwelling limit) as well as loss of use.

The homeowner policy also includes liability protection for you at your residence and worldwide. Since you now own property, you have assets you need to protect, so be sure you have adequate liability coverage. Talk to your insurance agent to discuss recommendations and ways to keep the insurance costs within your budget.