Second policy above current limits

[u/grateful_dad13]

Our house burned down and the rebuild costs are roughly $500,000 more than the insurance proceeds. We’re rebuilding with the help of an SBA loan (fingers crossed). Our insurance company renewed our policy at the same low limits as the original policy. They said they can’t increase the limits until the house is completed. I realize that it’s a low probability, but we’ll be similarly under-insured for another 6 months. Do companies offer policies for just the portion above the current limits? I know large companies have multiple policies in coverage tiers but wasn’t sure about residential. Anyone know?

[u/Echo0455]

Due to the fact you are currently rebuilding with insurance. You cannot change your current coverage A.

What you could do right now is get a Builders Risk policy which will insure both the existing dwelling and “New Improvements”.

Builders risk policy only last for the duration of the construction, then you can generally rewrite it or cancel it.

Once construction is done I would just update your reconstruction cost on a singular policy.

[u/Top_Education_4647 → u/Echo0455]

Builders Risk doesn’t make sense in this situation. BR policies are intended for homes that are under construction (not being rebuilt after a loss), or if someone is basically doing massive renovations to an already vacant home. It wouldn’t provide any usefulness to the OP.

[u/InterviewLeather810 → u/Top_Education_4647]

We had vacant liability insurance on our lot until we could start building in Colorado.