Several years ago, I bought an apartment for 500k; the land value at that time was about 200k (now it is higher). Recently, I have renovated the apartment completely, for about 800k (I kept all the receipts). Now, I would like to buy apartment insurance, and I have to decide what sum to write in the policy.
The simple calculation is: 500k minus 200k plus 800k = 1100k. But, will I really get that 1100k if my apartment is destroyed? Can the insurance company tell me “you paid too much for the renovation – we could find cheaper workers that will do it for less thank 800k”? This may be true – I could also find cheaper workers – but I wanted a high-quality job. But if they are going to pay me less than 1100k, of course it is wasteful for me to buy a policy of 1100k.
More generally, my question is: can I know in advance, how much the insurance company will pay me in case of a total loss, so that I write the exact sum – not too much and not too little?
