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Insurance problems and cures

How much does it cost to rebuild a house?

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One big problem after a loss is having too little insurance to rebuild the house. Why?
The value of the house for rebuilding is not the same as its market value.
The value of the house for rebuilding is not the same as its assessed value.
The value of the house for rebuilding is not even the same as the cost to build it on a “green field”.
Assessment often has nothing to do with current values and in most states includes the value of the land.
Market values include land (for freestanding structures) and can even be lower than the cost of replacing the structure alone.
And building from a green field does not include the cost to haul away rubble and cinders and otherwise clean up a site.
In addition, with older houses, there are two more problems. First, very old houses may have some special features which are difficult or impossible to replace with modern construction. Second, old houses may be subject to construction laws which require you to rebuild to modern codes, increasing costs.
Get your insurance advisor to help you estimate the replacement cost of your current home. Start with the square footage, note special features, try to get close to the value. You don’t want to have a loss and be unable to replace your home.

http://www.gbwinsurance.com 1-800-548-2329

Written by gbwinsurance

January 18, 2010 at 10:03 pm

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