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My Property Value is Down, Why isn’t my Premium Lower?

    < 1 minute read

    While the two seem like an exact correlation, they really have little to do with one another.  When you are purchasing a homeowners policy many things will be considered to determine your premium price.  Some of those factors include:

    • Type of Construction of your home – Frame houses may be more expensive to insure than brick because they are more flammable and less sturdy, relatively speaking.
    • Age of your home – Newer homes may qualify for discounts if they are made from safer and stronger materials. Older homes are more expensive because the likelihood of a claim being filed is much higher.
    • Proximity to fire protection – The closer the fire department is to you, the better chance they have of getting a fire under control quickly.
    • Deductible amount – A higher deductible means a lower premium and vice versa.

    While these are some factors involved in what your premium will be, the market value is not considered because this number in some cases is arbitrary.  Property value is based on many things and can fluctuate often, so it is not a reliable number for insurance companies to use because it can change often.  Instead they look at a more solid number such as the amount it would take to rebuild your home (based on current material costs), because this does not fluctuate as much.

    For more information about homeowners insurance in California, please contact a qualified professional at or call 888-772-4247.

    This content is offered for educational purposes only and does not represent contractual agreements. The definitions, terms and coverages in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.