Extended replacement cost is a type of coverage available on some homeowners insurance policies. It provides additional protection beyond the standard coverage limits in case your home needs to be rebuilt or repaired after a covered loss.
With extended replacement cost coverage, your insurance company will pay to repair or rebuild your home up to a certain percentage above the policy limit. This percentage varies by insurer and policy, but it is typically around 25% to 50% above the policy limit.
For example, if your home is insured for $300,000 and you have 25% extended replacement cost coverage, your insurance company would pay up to $375,000 to repair or rebuild your home after a covered loss, even if the actual cost of repair or rebuilding exceeds your policy limit.
It's important to note that extended replacement cost coverage only applies to the dwelling portion of your policy, which covers the structure of your home. It does not apply to personal property or liability coverage.
Topics: homeowners insurance, replacment cost, extended replacment cost, home insurance, oklahoma home insurance