No. A higher appraisal does not automatically raise your required insurance coverage, because the two numbers measure different things. An appraisal reflects market value, the land plus the improvements, which is what the home would sell for. Insurance is priced on replacement cost, what it would take to rebuild the structure, and the insurer sets that from the home's size, construction type, roof, and other risk factors. Land has no rebuild cost, so market value and replacement cost routinely differ, sometimes by a lot. Where the lender cares is the connection between your coverage and your loan. If the insurer's stated replacement cost comes in below your loan amount, the lender will ask for one of two things: a replacement cost estimate showing your dwelling coverage is adequate, or a guaranteed replacement cost policy, which commits the insurer to rebuild the home to the same standard even if the actual cost runs over the estimate. So when the value comes in higher on a refinance, do not assume the premium has to jump with it. Check the replacement cost figure on your policy against what your lender needs, and adjust the dwelling coverage only if there is an actual shortfall. The requirement comes from their numbers, so confirm the specifics with your lender and insurer.