Rebuilding w/Insurence$$$ – Code Changes
Scenario of rebuilding a home, with homeowners insurance money.
Now, the new building code requires things like hurricane straps, different foundation details from original home, etc. There is an insurance policy endorsement that will also pay for these costs that are NOT covered by “replacement cost of structure” policy.
Is that endorsement REALLY necessary? Has NOT having that endorsement ever affected rebuilding a home after a large loss?
Renewal time for me. Policy just over $400K replacement, costs $1600/yr. Adding on the “Ordinances and Laws” coverage costs another $400/yr.
Can’t I just have a whole house built to new codes with that $400K? Maybe just a little smaller , or with lesser priced details (i.e. 2 bathrooms instead of 3 bathrooms)?
Quantum materiae materietur marmota monax si marmota monax materiam possit materiari?
Replies
bump
After Katrina, Rita & Wilma a few years ago I dealt with a lot of these issues on behalf of the insurance companies. To the best of my knowledge only two claims on which I was involved dealt with this issue and these were commercial claims where the code upgrades, primarily roofing and electrical, were substantial due to severe damage or a complete loss of the structure.
In my mind, for a residential structure, the numbers just don't add up. It is also a function of how the adjuster writes the estimate for repair. Sorry I cannot be of more help with your question.
>Can't I just have a whole house built to new codes...<
not every instance will it be a complete demo of the old house. For me more often than not it's just a partial to some extent and not a comeplete raize and build anew.
For instance fire in a kitchen calls for a gut the kitchen and any damage nearby. The other end of the house tends to be only smoke damage if that but I have to go there to install smoke detectors which may or may not be challenging task for access for the electricians. Seems like that rider on the policy will cover those items not directly related to the fire but required to be performed to pass inspection for the new CO.
Insurance issues like this vary greatly from state to state and what's covered and not by an individual policy depends on the history of litigation in the state. A call to your state insurance commission would probably provide the answers you seek.