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Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: Steeze on May 01, 2019, 05:47:41 PM

Title: Co-op 'Home Owners' Insurance - Dwelling Coverage Limits?
Post by: Steeze on May 01, 2019, 05:47:41 PM

DW and I just purchased a pre-war co-op in NYC for around $300k at 775 sf. Not sure how much dwelling coverage I would need for a "studs-in" policy. I am seeing ranges from $25/sf to $400/sf. on other forums. On the low end I would be looking at $500/yr. on the high end I would be looking at $2,500/yr.

The low end would give me OK liability coverage ($300k) but I would be screwed if I had to do a gut-job after a fire for example. High end would have the same liability coverage but also cover a complete gut job of high quality from the studs in, but that is a low probability event (hopefully). Middle of the road ($1250/yr) would cover me for a basic gut job ($200/sf) with a little higher deductible ($2,500 vs. $1,000)

What say Ye, how much coverage is needed?
Title: Re: Co-op 'Home Owners' Insurance - Dwelling Coverage Limits?
Post by: six-car-habit on May 02, 2019, 09:17:55 AM
 Are you saying that if a fire burnt out your co-op / apartment in a shared building [ shared walls , shared roof, shared utility lines/ pipes]  that $300,000 is not enough to replace wood stud walls + sheetrock + kitchen appliances + broken pipes + wires + paint and trim + flooring- for a 775 square foot area ?
   I know NYC is expensive for material and labor but still, $300K seems like it should be plenty for 775 Sq ft.

 If the brick / concrete structure of the building is compromised would you still want to live there ?  Roof should be a common cost shared amongst all owners.

  Your policy should have a seperate line item for your personal property [ clothes / pots and pans / furniture / electronics / etc. ]

 If you want a "high end replacement" policy to cover "medium quality" finishes that are currently in the unit, i guess you could prioritize your spending that way...

  Personally if the unit has a fair market value of $300K , i'd insure it for that, not twice as much.  Then again if my home was completely destroyed, i probably wouldn't rebuild the same floor-plan / structure, although i have more potential replacement choices than you since it is a single family home on private yard.
Title: Re: Co-op 'Home Owners' Insurance - Dwelling Coverage Limits?
Post by: SimpleCycle on May 02, 2019, 10:20:19 AM
When I looked at this, I found averages of $75-$100/sq ft for replacement in my metro area.  We're insured for about $100/sq ft on our condo, plus personal property coverage for the estimated cost of our personal property that we'd actually replace.  We also have liability insurance up to the required minimums for our umbrella policy.  So $100k of building property, $35k of personal property, and $300k of liability costs us $541/year.  We found HUGE variations across insurance providers, so it pays to shop that around.

Edited to add: we could self insure for everything except the liability, but obviously our mortgage lender won't let us do that....
Title: Re: Co-op 'Home Owners' Insurance - Dwelling Coverage Limits?
Post by: Steeze on May 02, 2019, 10:51:27 AM
300k would be a complete replacement as-is; custom cabinets / counter tops, wood floors with inlays, vaulted ceilings, plaster walls, moldings, etc. I cannot imagine it going more than 300k even with high end finishes, current finishes are mid-range but old. Probably could get it done for 200k with the right contractor, 100k might not cover the cost of a complete replacement with the same historic style.

If the structure is completely compromised the building would be rebuilt as-is (land-marked building), I would be left with a bare unit with no interior.

Property is minimal, I am sure 35k is a major over estimation haha.

FWIW I just got another quote for 200k dwelling / 30k property / 500k liability / 500 deductible for $750/yr. from Hanover Insurance Group.
Seems to be the best deal so far.