Over the past few years, all homeowners, but especially those in the Santa Clarita Valley, have seen the cost of homeowners insurance rise to levels that are unaffordable for many. The increased frequency of catastrophic events, accompanied by rising building costs, have combined to create this situation. I suspect the crisis will intensify in the near future as the financial impact of the recent fires works its way through the system.

Last summer when our homeowner’s insurance policy was up for renewal, my insurance company sent me a thorough analysis of what it would cost to rebuild our house. They had previously sent a representative to tour our house who took numerous photos and jotted down extensive notes about the quality of construction and improvements.

I was surprised to see that the insurance company’s cost estimate of totally rebuilding our house was about $300,000 more than it was worth. I shared the analysis with a couple of contractors who advised me that the insurance company’s estimate was indeed fairly accurate — especially if the house had to be rebuilt after a significant casualty event like a major fire or earthquake.

The insurance company’s rebuilding cost estimate came to about $340/square foot. That may be too low. The Wall Street........

© Santa Clarita Valley Signal