Quentin is getting quotes for insurance on his building. His agent recommends he purchase enough to cover the _____ value, even though this amount is more than Quentin paid for it.

Question

Quizplus · Accepted Answer

The agent is recommending Quentin purchase insurance enough to cover the replacement value of the building. This means the cost to rebuild the building with similar materials and characteristics. It is important to have enough insurance to cover this amount in case of a total loss or damage to the building. Actual cash value would only cover the depreciated value of the building, which may not be enough to rebuild. Coinsurance and minimum refer to specific insurance policy terms and are not relevant to this question.

Quentin Is Getting Quotes for Insurance on His Building