The purpose of the Property Insurance Replacement Cost Valuation is to determine the correct amount of insurance the association needs to carry in order to comply with their association documents and fiduciary responsibilities.
The property insurance replacement cost valuation is not a real estate appraisal. A real estate appraisal and a property insurance valuation have two different objectives. Most real estate appraisals are used to purchase property.
All Property Insurance Valuations are used to determine the cost of reconstructing the insurable property according to the type of coverage included in the insurance policy. Most policy provisions are dedicated by State of Florida Statutes.
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What we do starts with an onsite inspection of the property to be valued. Typically we meet with the property manager or responsible party to review the property owned by the association or corporation and determine the intended use of the valuation. We list all property to be included and collect field data on each of the insurable property locations. A detailed sketch of the major building locations is completed along with the information on all other insurable property. Photographs are taken of the insurable property.
We complete quantity calculations on the data collected for each piece of insurable property and develop the estimated insurable replacement cost for each insurable asset. We use the segregated cost method to establish replacement cost along with input from local builders and contractors. All insurable assets are listed in a summary format with their respective estimated replacement cost. This information is coupled with a narrative description of the property, property condition, photographs, plus construction and insurance underwriting information, which is needed in order to properly understand the overall property insurable risk and to produce the Property Insurance Replacement Cost Valuation Report.
We recommend updating all Property Insurance Valuations every two-three years.