Is Your Eichler Underinsured? - Page 2

Many homeowners have sought coverage on the assumption that something around $300 per square foot was a reasonable policy. Well, it once was. But rising construction costs in recent years are prompting some to reconsider. Scanning social media, some Eichler owners wonder whether twice that amount is enough today.

"That seems like a lot," Parekh replied to the $600 figure. In concession to a reality of his industry, he stated, "No one's going to give you an exact answer, because no one wants the liability."

"I've never been in a position to have to figure replacement [cost]," admits Smollen, who nevertheless is aware how much it has cost per square foot for other rebuilds he has done: "I think we can do ‘replace in kind' for most Eichlers for $400, $450."

But is that really enough to cover the cost of rebuilding your home in the area where you live?

In addition to insuring replacement of your home's size, Parekh said, "The quality of finishes in your home dictate, to a large degree, the cost."

The agent said AAA rates interior treatment of a home on a five-level scale, informally known as economy, standard, above average, custom, and premium.

Parekh said it's important to keep records of all improvements made to your home, especially reroofing, and check in with your agent after significant upgrades, such as an addition, to make sure your policy is still sufficient.

"You want to check into it after some major work you do with a contractor," said the agent.

"Make sure everything is covered. That's why insurance is there," concurs Smollen. He and Parekh agree that some improvements can even lower your insurance premium. Because of fire prevention improvements such as smoke alarms and use of sheetrock, Smollen said, "If you've had a lot of your house remodeled, it's going to be safer than it was when it was built."

Besides adding sheetrock as a fire retardant, Smollen said some Eichler owners have him install heavy-duty Titan bolts to better secure the house to its foundation against seismic episodes. While this move might reduce the need for extensive earthquake coverage, Smollen also indicated that quakes affect Eichlers less than other homes anyway because "they wiggle, they're flexible."

And of course as with most insurance, Parekh said that whatever coverage you get, "You just want to pay the bill every year and never use it."

Well, amen to that!