Buying a house is said to be the cornerstone of the American Dream and a homeowners insurance protects that dream. But most homeowners insurance policies limit their cover for ultra expensive or very hard-to-replace possessions namely, engagement rings, watches, furs, antiques and others. Each item has to be appraised and additional endorsements are needed to protect them. Lending institutions usually make it mandatory for borrowers to buy a minimum amount of homeowners insurance – normally equal to the appraised value or the purchase price of a house. However, this could not be the actual amount of cover that you really need. It would be a good idea to find out how much it would take to build your house again and think of insuring it for that amount.