Is the building insurable?

Answered by:

Question:

How do you know if a low value building has an insurable value? Do you determine this by determining if it is insured on the borrower’s hazard policy?

Answer:

Every building has some value and there are many ways to determine a building’s insurable value. You could look at the Replacement Cost Value (RCV), the Actual Cost Value (ACV – cost approach), the amount of hazard insurance in place on the property, the functional building or demolition/removal cost to name a few.
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