Hello,
I am a Michigan insurance agent. Part of the insuring process for homes as you may know is figuring out what the reconstruction cost of the house would be in the event of a total loss. Recently, with declining home values the issue of replacement costs and how they are determined is being scrutinized much more closely than what it once was. The reason being, insurance companies do not want to insure a home whose value is significantly lower than the replacement value, on a replacement basis. Most require the market value to be anywhere fomr 70-80% of the replacement value.
This has raised alot of question about how our reconstruction costs are calculated. Not being builders and contractors, alot of what we know about homes has been passed along through training over the years and now some of us are wondering if we could maybe be more accurate in what we do. For example, we may have a 75 yr old lady call to get insurance and yeah, she may know how many rooms there are or how many bathrooms or even how many square feet the house is but then you get to questions like do you have a poured concrete or block foundation, many do not know. In these events we are some what forced to make an estimate. Come to find out most agents have different beliefs about what certain standards are in construction. So this raises some questions about standards of construction that i am hoping to get some input on, like:
1) Poured concrete foundations vs block foundations. My understanding is that newer homes use poured where older used block. Is this correct and if so, around when did it become common practice to use poured walls vs block?
2) Shingles, we have always assumed that these are Composition or Asphalt shingles. Some agents believe most newer homes or houses that are re-roofed these days use Architectual Shingles? Is this correct and if so, when did this start to become common practice?
Thats is it for now, if i come across more Ill post them.
Thanks in advance for your time and answers!
