Insurance Appraisal Overview
Insurance Appraisal Overview
First, the appraiser must carefully identify and document the subject property using Tax Maps and Tax ID Numbers for each unit from the appropriate county property appraisers office. Next, the appraiser must photograph the front, sides and rear of each building and label each building with address information. If the buildings are destroyed by fire or wind, good photographs will document what once existed. Next, the appraiser must determine the size of each unit and the construction materials used such as wood (frame), block (masonry) or a combination of materials (ISO 1, 2, etc, see below)
"Commercial Express" by CoreLogic is an internet-based Cost Estimating Software that is the most widely accepted and often required software by more and more Insurance Companies. This program requires the appraiser to use defined Occupancy Codes (see below) that apply to each building component of each property. For example, for most condominiums under FL Statute (FS) 718, many components of the interior of the condo unit is covered by the unit owner and is not the responsibility of the condo association; however, air-conditioning systems are covered by the associations "Master Policy" and are therefore included in the Insurance Appraisal. Link to FS 718
Conversely, FL Statute 720, applies to Homeowners' Associations and which typically pertains to Townhome Condominiums Link to FS 720
(11) INSURANCE.—In order to protect the safety, health, and welfare of the people of the State of Florida and to ensure consistency in the provision of insurance coverage to condominiums and their unit owners, this subsection applies to every residential condominium in the state, regardless of the date of its declaration of condominium. It is the intent of the Legislature to encourage lower or stable insurance premiums for associations described in this subsection.
(a) Adequate property insurance, regardless of any requirement in the declaration of condominium for coverage by the association for full insurable value, replacement cost, or similar coverage, must be based on the replacement cost of the property to be insured as determined by an independent insurance appraisal or update of a prior appraisal. The replacement cost must be determined at least once every 36 months.
ISO is short for "Insurance Services Office". Insurance companies and related industry participants use ISO categories as they apply to building construction types. For example, ISO 1 applies to frame or wood construction while ISO 2 applies to masonry construction. Other ISO numbers apply to other types of construction such as steel frame.
Occupancy Codes: The Commercial Express web-based cost estimating software uses Occupancy Codes such as the one shown below. For most condominiums that fall under FS 718, the 1335 Occupancy Code is appropriate. The definition shown is from CoreLogic's Commercial Express and describes what items are included and excluded in the cost estimation associated with a particular code.