What replacement value remains above current coverage and savings?
Coverage gap
$210,000
Tip. Liability needs are usually larger than people guess, which is why umbrella policies exist and are cheap.
Explore the numbers
Start with a scenario, then read the response curve to see which input actually moves the answer.
Example 1
A liability need above the policy limit, which is the classic case for an umbrella policy.
Coverage gap
$210,000
Example 2
Coverage plus savings that fully meet the need, so the gap closes.
Coverage gap
$0.00
Example 3
A rebuild cost well above the dwelling limit, which is common after construction costs rise.
Coverage gap
$215,000
Sweeps current coverage from half to one and a half times your value, holding everything else fixed.
Response curve
Coverage gap
$210,000
Finds how much risk is still uncovered once you count current coverage and the liquid savings you would genuinely be willing to spend on a loss.
Gap = max(0, replacement or liability need − coverage − liquid savings)
It can sketch a gap, but income replacement really needs a fuller analysis: years of income to replace, existing assets, future costs like education, and any survivor benefits.
Only the portion you would actually spend on this loss. Retirement accounts and an emergency fund earmarked for job loss are not claim money, even though they show up as savings.
For a home it is the cost to rebuild, not the market value, and the two can differ enormously. Insurers run replacement cost estimators, and construction cost inflation means an old figure is usually too low.
Insure the dwelling for its full replacement cost, which is the cost to rebuild, not the market value or the mortgage balance. Contents need a separate limit, which the home contents calculator helps you size.
An umbrella policy adds liability coverage above your auto and home limits in million-dollar increments, and it is usually inexpensive. It is worth considering once your net worth exceeds your current liability limits.
Compare the cost to rebuild or replace with your coverage plus the savings you would actually spend on a loss. If the need is bigger, you have a gap, and construction cost inflation means an old coverage figure is often too low.
No. They are educational estimates based on the inputs and assumptions on this page. Confirm important decisions with a qualified professional and your own documents.
The questions people usually ask next.