Building Replacement Cost Value

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The Building Replacement Cost Value (BRCV) is the cost to replace a building or unit, including the foundation, using the same type of material and construction, without factoring in depreciation.
The BRCV is used as a rating factor for determining flood insurance premiums but does not impact the replacement cost determined at the time of loss.

How BRCV is Determined

FEMA Determination:
- For some occupancies (e.g., single-family homes), FEMA calculates the BRCV using application data and property-specific industry data.
- If FEMA cannot determine the BRCV, the insurer must obtain it using common industry appraisal methods and report it on the application form.
Insurer Responsibility:
- For other occupancies (e.g., residential condominiums), FEMA does not determine the BRCV. The insurer is responsible for determining, documenting, and maintaining the BRCV in the underwriting file.

Supporting documentation must include:
- Recent appraisals of the building and foundation based on replacement cost.
- Records must be validated and updated at least every three years.
Documentation is not required for:
- Non-residential manufactured/mobile buildings.
- Storage/tool sheds or detached garages.
- Buildings or units with less than 1,000 square feet.

The ratio of building coverage selected to the BRCV affects the premium.
If a policyholder selects coverage above the BRCV, the higher coverage amount is used to calculate premiums.
Accurate BRCV ensures appropriate premiums and policyholder coverage alignment.