What are the policy limits (i.e. coverage limits) in the standard homeowners policy?
There are a number of different homeowners policy types, but the most prevalent is a homeowners type 3 policy which provides coverage for virtually all perils with specific exclusions to coverage as listed. The most notable coverage exclusions in Minnesota are flood and earthquake. The policy limit for the dwelling is usually determined after reviewing the replacement cost of the dwelling. The replacement value should not be confused with the homes market value or its tax/assessable value. The replacement value is what it should cost to rebuild the home with today’s costs for building materials and labor. The replacement value should take into consideration the specific features of the home including the number of bathrooms, fireplaces, built-in appliances, finished basements, walk-out basements, decks and any other unique attributes of the home. The features are used in conjunction with the square footage of the dwelling and any additions it may have to determine its actual replacemen
