Your home's replacement cost

Several factors can affect the cost to rebuild a custom home, including:

• Client urgency to rebuild and return home
• Compliance with updated building codes
• Lack of economies of scale when rebuilding a single home
• The quality and quantity of custom finishes, features, and materials
• Scheduling and resource availability
• Availability of reconstruction contractors, especially after a catastrophe

Each year, Chubb applies a Construction Cost Adjustment Factor (CCAF) to help keep your homeowners policy aligned with changing construction costs and inflation. This factor uses decades of experience, trusted industry sources, and localized Chubb claims data.

For added protection, we offer an Extended Replacement Cost option. When included, this coverage can pay above the policy limits shown on your Coverage Summary if the cost to rebuild or restore your home after a covered loss exceeds those limits.

Market value and replacement cost are different.

• Market value is the home price a buyer and seller might agree on in today’s real estate market. It reflects factors such as location, property size, land value, and recent sales of similar homes.
• Replacement cost is the estimated cost to rebuild your home with similar materials and features if it were a total loss. It includes labor, materials, contractor and architect fees.

Because market value is shaped by broader real estate conditions, it can be significantly higher or lower than replacement cost.

Reconstruction cost can be higher than original construction cost for several reasons:

• Your original build price may not include soft costs — architect, designer, and engineer fees — or out-of-pocket items such as smart electrical systems, light fixtures, and appliances.
• Rebuilding after a loss is often more complex than new construction, requiring top-down repairs, limited site access, protection of undamaged areas, and code compliance.
• Material and labor costs rise over time and can spike further after a widespread disaster.
• Older or customized homes may include special features or unusual materials that can be costly to duplicate.
• Economies of scale available on larger projects typically do not apply when rebuilding a single home after a loss.

Your Chubb homeowners insurance policy is designed to help you rebuild using like design, materials, and workmanship, helping preserve the historic character of your home. This may include features such as plaster moldings, antique flooring, period hardware, and matching exterior details like brick, cornices, and shutters.

You may choose your own contractor, including one experienced in historic restoration. If your home is in a historic district or is a local, state, or national landmark, an architect can help navigate required review processes.

Your building’s policy — also called the master policy, association insurance, HOA insurance, or, in some cases, HO-6 insurance — typically covers the exterior of your condo or co-op and common areas. However, what the master policy covers can vary by building, and coverage for certain parts of your unit may be subject to interpretation or dispute.

That’s where a Chubb condo or co-op insurance policy can help. It provides coverage for what’s inside your unit, including your belongings, interior finishes, and personal liability. It can also help protect against unexpected events like fire, theft, or a guest injury. In addition, Chubb offers automatic protection for shared property losses and an in-home assessment at no additional cost to help ensure your coverage reflects the true cost to rebuild.