Owning a home in Hot Springs is something special. Whether you’re tucked in a quiet neighborhood near Lake Hamilton, living in one of our historic homes downtown, or enjoying the views out in Hot Springs Village, your house is more than just four walls—it’s your family’s safe place.
That’s why it makes me cringe when I see the most common mistake homeowners make with their insurance:
Not carrying enough coverage to actually rebuild their home.
Why This Happens
A lot of folks think, “Well, I paid $250,000 for the house, so that’s what I need to insure it for.” The problem is, your insurance isn’t based on what you bought it for—it’s based on what it would cost to rebuild it if something happened.
And let’s be honest, construction costs in Garland County (and all over Arkansas) have gone up a lot in the past few years. Lumber, roofing, skilled labor—it’s all pricier than it used to be. That means if you’re not keeping your policy updated, you could be leaving yourself with a big gap.
A Real-World Example
Imagine your policy is written for $250,000, but if a tornado or fire destroyed your home, it would take $325,000 to rebuild. Insurance would only pay $250,000, and you’d be stuck finding a way to cover the other $75,000 out of pocket.
That’s a situation no one wants to be in.
How to Avoid the Coverage Gap
- Do a Quick Annual Review
Don’t just toss your renewal papers in a drawer. Take 10 minutes each year to check your dwelling coverage. - Look at Inflation Guard
Some policies automatically increase a little each year, but the “automatic” bump doesn’t always keep pace with actual construction costs here in Arkansas. - Talk With a Local Agent (Not an 800 Number)
An independent agency like Sharp Family Insurance knows what it really costs to rebuild a lake home in Hot Springs Village or a craftsman bungalow downtown. We’re not just pulling numbers out of a computer—we live here too.
Quick FAQs
Q: How do I know if my home is underinsured?
A: Easy—ask for a replacement cost estimate. If your coverage number is way below that, it’s time for an adjustment.
Q: Does homeowners insurance cover my land, too?
A: Nope. Your dirt is yours no matter what. Insurance is for the house, garage, and belongings.
Q: What if I remodeled my kitchen or added a deck?
A: Tell your agent! Updates increase your home’s value, and your insurance should keep up.
Bottom Line
The biggest mistake Hot Springs homeowners make is assuming their purchase price equals their rebuild cost. It doesn’t. Take a few minutes to make sure your coverage actually matches today’s costs.
Want us to double-check your policy for free? Call Sharp Family Insurance at (501)547-9474 here in Hot Springs or click to get a quote from our website. We’ll make sure your home is fully protected, whether it’s by the lake, in the Village, or anywhere in Garland County.