Condo Insurance Appraisal

Florida Condo Insurance Appraisal

A Florida condo insurance appraisal estimates and reports the replacement cost of condo association buildings and improvements. Generally, a good appraisal report shows a list of every building and improvement along with the replacement cost for each item in the list.

Generally, insurance carriers request an insurance appraisal report before quoting insurance policy premiums.

Florida Statutes 718.111(11) shows "(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."

Sometimes condo association governing documents require an update of the insurance appraisal more frequently than every 36 months.

You may note that the section of Florida Statutes that appears above shows ".... as determined by an independent insurance appraisal ..." Appraisals are performed by individuals or companies in the business of selling appraisal services.

The 2018 article Insurance Appraisals - You Get What You Pay For published by the Florida Community Association Professionals shows that:

It should be noted here that the Florida Department of Business and Professional Regulation, Real Estate Appraisal Board, does not consider a property insurable value report to be an appraisal of real estate for appraisal licensing purposes; there is no state requirement for age, education, or experience, nor is any license or certification given or needed for this activity. Therefore, consumers should be aware that there are or may be unqualified individuals or companies soliciting for this business.

Some Florida condo buyers wish they had read the most recent insurance appraisal report and understood the qualifications of the individual or company that produced the condo insurance appraisal report before making an offer to buy a condo. Also, some Florida condo buyers wish they had noted the date of the most recent appraisal and whether replacement costs may have increased since the date of the most recent appraisal.

Prospective Florida condo buyers should, if they don't understand condo association insurance appraisals, engage licensed and reputable attorneys and advisors to guide their buying decision.