I specifically am trying to find out if any state mandates the use of Marshall Swift data for calculating the reconstruction cost.

  1. 447 POINTS
    Thad Bynum
    Owner/ Partner, Bynum Insurance Agency, Inc, Clayton, GA
    This is a tough question because although a state could mandate the use of an estimator, I am not aware of one that does. As I am licensed in Georgia only I have several home owner companies and they each use their own estimating program. Several use the Marshall and Swift but not all of them. I know that over the years I have had clients that wanted less coverage than what the estimators show. Insurance agents are bound to insure homes to usually the full replacement cost to keep customers from being penalized at the time of losses for not having enough.
    Answered on August 29, 2016
  2. 102 POINTS
    David Hurd
    Owner / Agent, David Hurd, Farmers Insurance - Mansfield, Mansfield, Texas
    Insurance companies use several rebuild cost estimator tools to predict the value of a home. The replacement cost is based upon cost of materials and projected inflation factors. I have not heard of state mandated standards. I would ask the agent preparing the quote on what resources that company uses to calculate the rebuild / replacement costs for that property. If the answer is unclear or the calculation is less than previous value, I would advise that person to search for a company with an estimator tool to protect their most valued resource. There is no reason to go cheap when it comes to protecting a client's home.
    Answered on September 19, 2016
  3. 1185 POINTS
    Scott W Johnson
    Manager, Marindependent Insurance Services LLC, California
    Can a State Regulator mandate it is a question for the Lawyers, Insurance Regulators, and Judges.

    Do they? Well it would depend on each and every state insurance regulator.

    In California each insurance agent is required to take a home rebuild valuation course:
    "On or after June 27, 2011, every California resident fire and casualty broker-agent and
    personal lines broker-agent who has not already taken a homeowners’ insurance valuation
    training course must satisfactorily complete one three-hour training course on homeowners’
    insurance valuation meeting the requirements of this section prior to estimating the replacement
    value of structures in connection with, or explaining the various levels of coverage under, a
    homeowners’ insurance policy. "

    Section 8 includes: "(8) Review of the various methodologies of estimating replacement cost including:
    (A) Proprietary replacement cost valuation tools;
    (B) Real estate appraisals;
    (C) Insurance company’s valuation software;
    (D) Contractor’s and architect’s estimates or opinions;
    (E) Cost per square footage estimates; and
    (F) Insured’s opinion. "

    You can read the entire California Regulation (REGULATION FILE REG-2010-00001 ) here: http://www.insurance.ca.gov/0400-news/0100-press-releases/2011/upload/nr087NEWHOregs1.pdf
    Answered on October 12, 2016
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