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Helpful Video for Residential Replacement Cost in Florida.

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‘Insure To Value Insurance Clause’


In each homeowner’s policy, there is an “Insured to Value” clause. Even though this clause is always there, few agents or companies take the time to educate their customers on what it means.

The Insured to Value clause states that in order for your insurance company to fully replace your home, it must be insured for greater than 80% of the amount (many insurance carriers make it 100%) it would take to rebuild your home at today’s costs. This is very important and is one of the biggest reasons why people with insurance still cannot afford to rebuild their homes after a loss.
Put simply, people invest in homes because homes increase in value. If your insurance policy does not reflect the increasing value of your structure, you could be at risk.


Don’t Get Penalized for Being Underinsured


If you insure your home for less than its full replacement cost, you need to be aware of two possible claim penalties.

 1. The first penalty occurs if you are underinsured for a total loss (the complete destruction of your home). Let’s say your home, which you insured
for $250,000 ten years ago, burns to the ground, and the current cost to rebuild your home is $500,000. Since your home was only insured for $250,000, you suffer an out-of-pocket loss for the remaining $250,000.
  Why? This is the result of your policy not meeting the requirements of the Insured to Value clause. In other words, it was not insured for at least 80% of the replacement cost and disqualifies you from receiving the Extended Replacement Cost Endorsement to fully rebuild your home.

 2. The second penalty for underinsurance occurs when your home has a partial loss. Using the same example as described above, say you insured your home 10 years ago for $250,000, but the cost to rebuild your home today is $500,000. Let’s imagine a kitchen fire with extensive smoke and water damage, resulting in a $150,000 repair bill. You are insured, so you file a claim with your insurance company, only to discover that they will pay you $100,000. You’re out $50,000.
  Why? The vast majority of homeowner’s policies will only pay the full cost to replace partial damage to your home if you insure your home for at least 80% of the current cost to rebuild a new one. If you insure your home for less than 80%, your claim settlement will be depreciated.


Put simply, homeowner’s policies essentially state that if you insure your home for a depreciated value (in this case $250,000), then the insurance company will settle with you on a depreciated basis.
To ensure that you are protecting your investment, you must always insure your home for 100% of the cost to rebuild it today. Most insurance companies will not let you insure your home for less than 100% replacement cost when you buy a policy, but it is up to you to make sure you keep up with building cost inflation after you buy the policy. It is dangerous to sit on your policy year after year assuming it is still adequate.

Here is the formula the insurance company uses to determine if you insured your home correctly.
Did ÷ should = % x amount of the loss – the deductible = the amount due
You take the amount for which the home is insured and divide it by the replacement cost value of the home. This will result in a % amount. If that % amount number is 80% or more, you can stop. Your home is insured to value, and a coinsurance penalty will not be applied to your loss. If that % amount number is less than 100% you will then multiply that % number by the amount of the loss. You will then subtract your deductible and that will result in the amount due*. See below.

Practical Example:
You did insure your home for: $100,000.00
You should have insured it for: $200,000.00
You have a loss which totals: $50,000.00
Your deductible was:: $1,000.00
$100,000.00 / 200,000.00 = 50% X $50.000= $25,000.00 - $1000.00 = $24,000.00

As you can see in the above example, the insured did not purchase enough insurance and their $50,000.00 claim suddenly turned
into a $25,000.00 claim. The insured could receive a coinsurance penalty of $25,000.00. Bummer!

Referrals - What Are People Saying About Us?

"We hired a local appraisal company to conduct a ‘Replacement Cost Valuation’ on our resort. It took them over 3 weeks, but we got the report and forwarded it to our insurance company. It was immediately returned because it was not the type of report that was required for insurance. The appraisal company said that what they gave us was the ‘correct’ way to do the report.  Our insurance agent, Larry Hagar, contacted Expert Inspectors for us to do the valuation the correct way. They came out on the property, did the inspection and turned the report around in less than a week. It was what the insurance company wanted and their services where much cheaper than the first company."

Mike Simpson - Banana Bay Resort, Key West

 

"I am an independent insurance agent insuring all types of commercial property and have been doing business with Expert Inspectors Incorporated of Ormond Beach Florida (as) our main source for Windstorm and Hailstorm coverage in Florida.  Citizens Property Insurance Corporation has been requiring one hundred percent replacement cost appraisals for all new business as of 2004 when Florida experienced four hurricanes in a matter of between three and four weeks. Prior to that as an independent insurance agent appraisals were never required but after the 2004 hurricanes,  thousands of claims were settled and it was evident that the vast majority of property owners were underinsured and in many cases the construction was not accurate.  Anytime I call for a price and availability on a particular property I get it immediately as well as from one to three different days and times the appraiser is available. I also receive an emailed copy of the appraisal and the client is also sent one by regular mail with colored photos. One time as a favor the company stopped by a property I was working on to verify the construction at no charge. The owner offered to do it just because he happened to be in that immediate area on a particular day and as a result I wrote the account. They are also responsible for me writing many other accounts because of their availability, efficiency, and professionalism."  

Paul William DiFerdinand – Insurance Producer
Town & Country Insurance Agency, Incorporate
1525 Herbert St Port Orange, Florida 32129

 

"Expert Inspectors provide their customers with outstanding customer service, honesty and great prices for the services the company provides. They understand the value of customer service and building relationships with their clients. Our office has been using Expert Inspectors for years and Dave is like family. He goes above and beyond quality customer service. This company is always there to answer my phone call or email with any questions I may have.  Whenever our office has a client that needs a report completed, Expert Inspectors is who I suggest they call. They’re trustworthy and genuinely care about their clients. Our office highly recommends Expert Inspectors for all your residential and commercial inspection needs."

Autumn Scarsella - Commercial Account Manager
Smith & Associates Insurance Agency Inc.
508 Canal St. New Smyrna Beach, FL 32168

 

"We are a 40 building apartment community located in Ft. Lauderdale, Florida.  The insurance carrier that was covering our buildings increased our rates dramatically upon renewal. Our Agent reviewed what they had for our coverage limits and recommended that we have an insurance valuation done to determine what the amount should actually be to insure the complex.

When we received the report, it turned out that the buildings were actually insured for almost 20% more than they should have been. By changing the amount of coverage to the correct amount, the insurance premium dropped by over $17,000 per year.

Having the insurance replacement valuation done was well worth the investment. We saved many times the cost in just the first year. It is good to know that we are no longer paying out more money than we need to and now have the correct amount of insurance coverage."

Regal Trace Apartments - Ft. Lauderdale, FL

 

"One of the more established RCV production valuation companies we worked with recently had under-insured one of our insured's scheduled property by almost 50 percent than what it should have been.  Since we as agents rely on these reports for accurate insurance coverage limits, it came as a shock when our insured realized a $200,000 under-insured structure loss.  Suffice to say accurate replacement cost valuations are a critical complement to insurance.   Sticking with those firms (Expert Inspectors) that take the time in doing it right and who know the codes is part of what every decision maker should demand to insure their property adequately."    

Mike Mort - Insurance Office of America (IOA)

 

"The Board of Directors would like to thank Expert Inspectors for the attention to detail and professionalism in preparing our Insurance Valuation and Wind Mitigation reports.

We Would highly recommend Expert Inspectors!

In the performance of our inspection it was discovered that our insurance provider had grossly miscalculated the value of our condominium.  This impacted us financially in a very negative manner.  It was due to Dave's attention to detail in asking questions regarding our current policy that this situation came to light.

Expert Inspectors has helped in saving our Association THOUSANDS of dollars!!"

Earl Smith, Treasurer - Starboard Light Condominium Association, Inc.

 

"I’ve been recommending Expert Inspectors since around 2009. They have always delivered fantastic service and quality inspections, which means a lot to our Agency and our clientele. Great people, superior service. "

Victoria Melton Pegues - Stone Key Insurance

 

 

"This company provides a valuable service to residential and commercial properties. Making sure their clients have the proper amount of insurance to to replace their property in the event of a loss. Highly recommend"

Greg Schmidt - New Light Media Productions LLC.
 
 
"Great service, great customer service and great price!"

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All Condominium Associations in Florida are required to have Replacement Cost Valuations completed every 36 months by Statute:


Florida State Statutes Section 718.111(11)a:
“An association is required to obtain and maintain adequate hazard insurance that is based  upon the replacement cost of insured property, with the full insured value to be determined  by an independent insurance appraisal made at least once every 36 months.”

 

We offer both Wind and Flood Insurance Valuations, as well as Replacement Cost Valuations for Condominium Associations. This statute applies to ALL Residential Condominium Associations.


The finished report provides replacement valuations on not only the structures, but also site additions as well.  These include swimming pools, tennis courts, fencing and so on.

 

Expert Insurance Valuations of Florida
Expert Insurance Valuations. Office Hours: Mon-Fri 9-4pm
210 Charles Street
Port Orange 32129
Local: 386-677-8886
Toll Free: 866-480-8236

Meet the Expert Team.

Dave Kolodzik, PPIA, CRVS

Dave Kolodzik, PPIA, CRVS
Expert Inspectors’ president has been conducting insurance inspections
and replacement valuations throughout Florida since 2002. He has also instructed dozens of other inspectors over the years.

Besides being a Certified Replacement Valuation Specialist he is also a Florida licensed all-line property appraiser with the PPIA (Professional Property Insurance Adjuster) designation. Dave is also certified continuing education instructor for Community Association Manager licensees.

Ramon Giaconne

Ramon Giaconne
Ray is a Florida Certified Building Contractor with over 30 years experience
with a great understanding of construction laws and contracting business practices.

Currently Ray oversees our wind storm mitigations, roof condition inspections and personally conducts all inspections relating to balcony railing code compliance satisfying the Department of Business Professional Regulation required form DBPR HR 7020.

A valuable team member to have on your side.

M. Anastasia Kolodzik

M. Anastasia Kolodzik
Anastasia is Experts’ reserve study specialist. She personally works with each board and property manager to customize the reserve study to the individual need of each association.

The process begins with an on-site inspection of the
association. She then meets with the property manager and board to
collect the necessary information to produce a funding plan over a specified time period.
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