There’s been a lot of chatter in the last year about the runaway lumber prices. It’s been reported that the price increase of lumber has added $36,000 to the price of a single-family home (www.forconstructionpros.com). As of July 2021, the prices of lumber have begun to decline, and forecasted to level off by mid 2022. In the event of a smaller/partial loss the insurance company will need to incur these higher prices, but if you experience a total loss on your home it will likely be 12-18 months before the insurance company has to incur the cost of the materials.
So, you may be thinking “will the surge in lumber costs impact my homeowner’s insurance premium?”
Hanford Insurance Agency has not seen a significant increase in premiums from the companies we represent. So for the short term, we’re not seeing premium increases. We continue to monitor so we can give you the best option for your insurance dollar.
How can you stay current and respond accordingly?
1. Review your policy annually
Understand fully your homeowner’s insurance policy. Do you understand the difference between replacement cost and ‘actual cash value’ coverage?
2. Consider policy adjustments
Some policies have hard to find benefits that can be adjusted to meet your changing needs. We’re always glad to discuss potential changes and run some scenarios for you. Some companies include more in their standard policy, so a switch might lead to a savings or more coverage for the same premium.
3. (this is important!) – Communicate with your dedicated insurance agent at Hanford Insurance Agency
It’s so important for you to understand your homeowner’s policy, and the renewal process particularly when rates may change. Communicate any updates to your agent including any remodels, or building additions to ensure your coverage is complete. We are more than happy to properly adjust so the coverage matches the value of your home
Lastly, please don’t hesitate to ask us questions – we’re here to help you!