Your Greensboro homeowners insurance is financial protection you put in place should your home or the personal property you have in it be damaged, destroyed or stolen. It may very well be your most critical form of financial protection since your home likely represents your greatest financial asset.

If your home is being purchased using a mortgage, it’s almost certain that your mortgage company requires you to keep a homeowners insurance policy in place and at certain coverage amounts. From your mortgage company’s perspective, the necessary coverage amount is enough to completely cover the outstanding balance of your mortgage loan should your home be totally destroyed by a devastating event such as a house fire that burns your home to the ground.

How Much is Enough for You?

As the principal of your home loan decreases, your mortgage company’s financial exposure also decreases, requiring less payback in the event the home is destroyed. The amount required to rebuild your home in the current market may be more, however, than the amount of protection initially put on the home when your homeowners policy was first written.

Your home may have appreciated in value significantly since you first took possession, and its current value must be considered when deciding whether your Greensboro homeowners insurance policy is enough to rebuild your home in today’s current homebuilding market. To come up with an accurate estimate, you need to seek out expert advice from your insurance agent and home builders in your local area to determine the current cost per square foot to build a home of similar quality to yours. This should be inclusive of floors, the roof, doors, windows, built-in appliances and added structures like fences and garden sheds. You can do these calculations yourself or hire an independent appraiser to do it for you.

Actual Cash Value vs. Replacement Coverage?

Another important determining factor in figuring your homeowners insurance coverage is whether you want a cash value policy, which pays a claim according to your home’s value minus depreciation, or a replacement value policy, that pays for a rebuild regardless of depreciation.


If your home is located in an area susceptible to floods or earthquakes, your mortgage company will likely require that you add extra protection for these perils not covered in a standard Greensboro homeowners insurance policy. You may want to consider these even if your mortgager doesn’t require it.