They are in a much better position to predict when a home is underinsured, but they are allowed to only tell you if you try to claim.
Maybe we need a facts box that shows the estimated payout for various events and how much the out of pocket is. And it must be redlined on renewals.
The systemic issue right now is that the auto-inflation algorithms used by many legacy carriers are often loosely pegged to general Consumer Price Index rather than a localized Construction Cost Index. So you get a standard 4% limit increase while local lumber/labor costs spike 20%.
From a business perspective, insurers are terrified of 'sticker shock.' If they accurately updated the Replacement Cost to true 2026 values, the premium would jump, and the customer would churn. It’s an incentive misalignment where staying quiet retains the customer but leaves them exposed.