Property Valuation
An appraiser in Louisiana is asked to estimate the 'insurable value' of a property. This differs from market value because insurable value:
AIs always lower than market value
BEstimates the cost to replace the improvements (excluding land) for insurance purposes — focused on replacement cost, not market value✓ Correct
CIncludes all liability potential of the property
DIs determined by the insurance company's actuarial tables
Explanation
Insurable value (or insurable replacement cost) estimates the cost to rebuild the improvements (excluding land value) in case of total loss — for insurance coverage purposes. Land cannot burn or flood away, so it is excluded from the insured value.
Related Louisiana Property Valuation Questions
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