Reconstruction costs continue to rise, leading to annual increases in dwelling insurance coverage. This is being seen nationwide, with Minnesota seeing some of the higher increases. Minnesota is seeing reconstruction cost increases of about 6.91%. 

The primary driver of reconstruction costs increases is labor and material costs. Material costs increased by 2.6% from 2024 to 2025. While lumber costs have remained relatively stable, concrete has seen the highest material cost increase, followed by paint.

Labor costs rose 5.3% from 2024-2025. Again, concrete masons have had the largest labor rate increase, followed by drywall installation. A shortage of workers remains a key factor driving up labor costs. 

Given rising reconstruction costs, it’s important to review your dwelling coverage to ensure it remains adequate.