While recent home prices have been on the rise, the rise in costs of homeowners insurance has been going on for years now, even when home prices were depressed. And unfortunately, there is no break in the rise of insurance costs, as explained in the new article, “Does Home Value Affect Homeowners Insurance?” on the Equifax Finance Blog.

One of the reasons that homeowners insurance costs have risen it that insurance agents value homes differently than real estate agents or tax assessors. Instead of measuring relative value in comparison to the market, insurance agents have to calculate what it would cost to rebuild the same kind and quality home as the home on your property, either as replacement cost coverage or actual cost coverage. The difference between the two is simply that actual cost or home value suffers from depreciation, while replacement cost does not.

Replacement has likely gone up in price, as building material prices have gone up and building codes have changed that may require additional work on your home, which means additional expenses. While you may have gotten your home upgrades on a deal or performed some of the work yourself, the insurance company can’t enter that into the equation, especially when it comes to the cost of replacements.

While these costs are on the rise, homeowners may be able to find some relief in new incentives, either through discounts or savings that can help lower your costs. Often, these are home improvements that either add to the safety and security of your home, or are energy-efficiency incentives – either way, you benefit in more ways than just a policy discount.

To learn more about the ins and outs of homeowners insurance, retirement and how to efficiently implement protection from identity theft, stop by the Equifax Finance Blog.