Determining a Homes Replacement Cost

When insurers calculate the replacement cost of a dwelling for homeowners insurance they use a specific type of estimator to determine the cost. A replacement cost estimator uses various criteria such as the square footage of a house, the number of baths and the type of kitchen as well as the type of basement to calculate the proper replacement cost. An estimator is a good way to obtain the actual cost of replacing a home that is being insured.

One way an estimator calculates a home’s replacement cost is to use the total square footage of a particular home. The square footage can include the actual dwelling as well as a garage and an attached deck. The square footage is an important factor because it indicates the total size or area of the home. In addition to the square footage there are also question regarding how many stories there are and the type of house. A house can come in many types including a ranch style or a bungelow style home. All of these factors including the square footage are used to determine how much it will cost to completely replace a home.

Another factor that an estimator uses to calculate the replacement cost of a home is to use the number of baths in a house and the type of kitchen. These two areas are important because they can sometimes be costly to replace because of the materials that are used. A bath comes in various sizes such as a half bath and a full bath. A kitchen can be a builders grade kitchen or be custom and have all stainless steel appliances. Each of these areas of a house are important to the calculation of the replacement cost of the home. The more baths there are the more the replacement cost value is going to be. The same can be said for the type of kitchen.

An estimator also uses the type of basement a home has to determine the total replacement cost value of a home. There are various questions about basements on an estimator. First, it is important to make a distinction between a basement, a crawl space and a slab. Each of these options will change the replacement cost value of a home. Usually a basement in a home is either finished or unfinished. A finished basement is one that has a ceiling with lights and a tiled or carpeted floor. Many basements are unfinished which means that they are the original concrete walls and floor. A basement that is finished will add to the replacement cost value of a home.

A replacement cost estimator is a good way to obtain the actual cost of replacing a home that is being insured. Insurers today use sophisticated computer computer programs to get a reliable estimate for the value of the replacement cost. These estimators take into account newer building materials and building codes to determine the replacement cost of a home.