An Insurance Appraisal is a legal document that estimates replacement cost of all buildings and structures in the organization. Insurance appraisal plays the following roles:
- Shows the size of all building and improvements.
- Estimates the current cost to replace the building and improvements.
- Talk about the construction of the building.
After the association has the document ready, it then submits it to an insurance company to purchase insurance coverage of their community. The main purpose of an insurance appraisal is to inform an association how much coverage to buy. If the company has no appraisal, it has to make a determination based on the insurance company’s estimate or recommendation. An accurate insurance appraisals in Minnesota service is vital since it ensures that an association obtains the right amount of coverage.
There are two main types of Insurance Appraisals Minnesota; an appraisal to obtain hazard insurance and an appraisal to obtain flood insurance coverage. Hazard insurance coverage includes fires, smoke, hurricanes, vandalism and tornadoes. It develops the replacement cost of the improvements of a property and subtracts all building components that are not covered in the policy.
Hazard insurance generally covers all structural components of a building. It also covers other items such as sheet rock, baseboards, interior doors, plumbing and HVAC rough-ins. A homeowner has a responsibility of purchasing an individual policy for coverage of the interior of their unit like ceiling fans, plumbing trim, finished carpentry, electrical trim, flooring, interior painting and built-in appliances.
The type of appraisal to obtain flood insurance coverage is needed for properties in high risk flood areas. It is obtained through a program known as National Flood Insurance Program (NFIP). Flood insurance is more beneficial to an individual than hazard insurance since it covers more items. It covers things inside an individual’s condominium, like counter-tops, showers, cabinets, and other built-ins.
It is important for an individual to understand how the condominium insurance process works. After an individual has basic understanding about condominium insurance, it is easy to hire a competent and well qualified appraiser hence saving condominium money. An individual should also understand insurance appraisals, its benefits and how it works.
