re: Home Insurance- Dwelling coverage

quote:

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I guess they justify the higher premium through significantly overdoing the dwelling coverage

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It is just a calculator.

Sometimes the number it spits out is wrong because the information plugged in is wrong (counting basement area as part of the square footage, listing an attached garage when it is built-in).
Sometimes the number it spits out is wrong because it isn't calibrated geographically (i.e. different construction costs in Iowa vs Louisiana vs New York vs California).

The cost calculator assumes the responsibility of determining how much a contractor needs to rebuild the property brand new including demolition and debris removal.
If the calculator is short and your policy causes you damages, then you have a lawsuit claim against the insurance company for failure to perform a duty. If enough people have that, then you have a class action claim. Needless to say, the calculator isn't built to be on the short side.