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Our house was about 3 years ago 83,857 insured what. The cost of replacement The tax value of the house is determined by the collector of the district currently 66,000 and 14,000 to the house on the floor. The original policy, almost 3 years, the full assurance that the market value of 83,537. Strangely, near the replacement value saved in $ 320.00. Since then, the insured value is increased to the 97000th The neighborhood is not the same as when we moved in. Much has changed. If we had a catastrophic loss, and chose not to rebuild, what can we expect? Merci.SERA needed a new question with more details and more details. TAKE A LOOK.

3 Thoughts on If we do not rebuild, which means paying insurance?
  1. Reply
    February 7, 2013 at 8:53 am

    83, 857 minus value of lot. You are expected to sell the lot if you chose not to rebuild.

  2. Reply
    Casey Y
    February 7, 2013 at 8:55 am

    If you choose not to re-build, you would get the “Actual Cash Value” of your house prior to the loss. So, you would take the age of the home and its fixtures and deduct depreciation (not accounting depreciation).
    If you re-build, you would get up to the full “Replacement Cost” limit.

  3. Reply
    February 7, 2013 at 9:04 am

    I seriously, serously doubt that $ 83,857 is the replacement cost of your house. Even at a very LOW $ 150 per square foot, that comes up as your house being 560 square feet. Miniscule.

    Replacment cost, how most policies are written, is on COST TO REBUILD. That’s what replacement means. Tax values, are “what you can sell the house and land for”. MARKET value. And tax values are notoriously LOW. So you’re comparing apples to oranges.

    If you have a kitchen fire with $ 50,000 in damages, the average for a kitchen fire, your house doesn’t get “totalled”. Do you want the market value – 1/5 of the tax value of your house, if it’s a five room house? Or do you want enough money to FIX the kitchen?

    If you underinsure your house, there will be a penalty. If you insure your house for HALF the cost to rebuild, you get HALF the claim paid. It’s also depreciated for age, until AFTER all the repairs are done. So in a 50 year old house, with an average kitchen fire, your house insured roughly for HALF of what it should be insured for, you’d probably get a check for $ 10,000, made payable to you and your lender jointly, with the other $ 15,000 to be paid jointly to you and your lender AFTER you’d made the $ 50,000 in repairs.

    How does THAT sound.

    Sounds to me, like you’re doing “do it yourself” insurance, and you don’t understand valuations, or coinsurance, or recoverable depreciation . . . and you’re going to do it to yourself, all right.

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