I have a 2 story 1800sq/ft house with partially finished basement(no bathroom, kitchen, bar) and was told by my insurance provider that they calculate replacement value of my house at $135 sq/ft and the basement is included at this rate.
My questions is should the basement be included in the cost? I know basements usually cost between $30 and $50 sq\ft to finish. What do you think the replacement value on a 1800sq/ft house should be?
It is true that the foundation of a home is included in the main or FINISHED legal living floor square footage. A walk-out basement is counted as saleable square footage. However, a basement is generally not, for they are usually considered to be holding up the living area of the home.
You should be able to get extra insurance on a finished basement. You are right that it will be calculated at a much lower rate. Your improvements, as long as they contribute to the home's value, should be able to be insured.
To find out this value, ask a real estate agent what the difference is in sale value of a non finished basement vs a finished basement. Also, a qualified home appraiser could give you the difference, and his expert opinion will give you an accurate, unbiased value for your improvements.
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