Replacement Cost Estimates
Know what it would actually cost to rebuild — before you need to.
Most property owners have never seen an accurate replacement cost figure for their building. The number on your insurance policy usually came from a quick agent estimate, an online calculator, or whatever number satisfied a lender — not from someone trained to calculate it correctly. In Alaska, where construction costs run well above national averages, that gap can mean tens or hundreds of thousands of dollars of exposure you don’t know you have.
RVS now offers a standalone replacement cost estimate service — produced using industry-recognized, professional-grade cost data by an appraiser experienced in cost approach methodology. It’s a faster, more affordable option than a full appraisal, and far more reliable than a free online estimate or an agent’s guess.
What is a replacement cost estimate?
A replacement cost estimate answers one specific question: what would it cost, today, to rebuild this structure with materials of similar kind and quality? It has nothing to do with market value — location, land value, and what the property would sell for don’t factor in at all. It’s a construction cost calculation, not a valuation.
This distinction matters because insurance coverage is based on replacement cost, not market value, and the two numbers can differ significantly. Getting it wrong doesn’t surface until the worst possible moment — after a loss, when you’re relying on a payout to rebuild and discover it falls well short.
This is not an appraisal. It does not include an opinion of market value, is not prepared under USPAP, and should not be represented as an appraisal for lending, legal, or other purposes that require one. It’s a standalone cost estimate, built specifically to support insurance coverage decisions.
Why it matters
- Multiple industry studies show that a majority of U.S. homeowners are underinsured relative to actual rebuild cost.
- A 2025 academic study of claims from Colorado’s Marshall Fire found 74% of policyholders were underinsured, with an average shortfall of $139,000 per household.
- Roughly three-quarters of commercial properties nationwide are estimated to be underinsured, by an average of nearly 50%.
- Alaska construction costs commonly run $250–$500+ per square foot — well above the national average — meaning an inaccurate estimate misses by a lot, not a little, here.
- Commercial properties insured only to a lender’s minimum (often the loan balance) can leave an owner’s equity completely unprotected — and can trigger a coinsurance penalty on partial losses if coverage falls below the policy’s required threshold.
Read more on this topic: Why a Cheap Replacement Cost Estimate Could Cost You More Than It Saves
How it works
Desktop estimate — available nationwide You complete an intake form covering construction type, plumbing fixture count, siding, interior finishes, and other cost-relevant details, and provide a sketch or building plans. RVS uses that information to develop your estimate.
Site visit option — Alaska only: An RVS professional visits the property in person to measure and directly confirm the construction type, fixtures, and finishes, rather than relying on your own documentation. This is a measurement and confirmation visit only — not a market value inspection — and it’s particularly valuable for older properties or ones with additions and remodels over the years, where a self-supplied sketch may not capture everything that’s actually there. Property must be accessible via a maintained road system, or a custom quote that includes access/transportation costs will be required. Some insurance providers and underwriters require the estimator to perform a site visit and not rely on the insured’s data for the report.
What counts as a “section”?
Pricing is structured around sections because that’s how the cost estimating software works — each distinct construction type within a building has to be estimated separately, and the cost to do that adds up per section.
A section is a distinct portion of a building with its own construction type, roof system, or era of construction — not just a different room or use. Multi-section buildings are the norm for Alaska commercial properties, not the exception.
Example: A commercial building has a single-story retail area in front with a flat roof, a two-story addition at the rear where the second floor is office space, and a basement beneath part of the building. That’s three sections — the retail area, the two-story office addition, and the basement — because each has a fundamentally different construction type that has to be estimated separately in the software. A simple single-story building of one construction type, built all at once, is one section.
This is also why we ask about your property’s history and improvements before quoting — a building that looks straightforward from the outside often isn’t once you account for additions, remodels, and different construction eras layered together over time.
Pricing
Pricing below is an estimate only and subject to change. Contact RVS for a firm quote on your specific property.
Base replacement cost estimate
(desktop, no site visit — available nationwide)
| Property type | Base price (one section) | Each additional section |
|---|---|---|
| Commercial | $850 | +$300 |
| Residential (attached garage included) | $500 | +$150 |
Additional detached outbuildings/sections: +$100 residential / +$300 commercial, per building/section.
Most properties aren’t a single section built all at once — additions, mixed construction eras, and multiple finish types within one building are the norm rather than the exception in Alaska. Pricing above reflects that reality rather than under-scoping a property that turns out to be more complex once your intake form or site visit is complete. It’s best to discuss your property’s specific improvements with us so we can put together a quote that actually fits it.
Optional site visit add-on (Alaska only)
For measurement and construction/fixture confirmation — not a market value inspection. Property must be accessible via a maintained road system.
| Area | Add-on |
|---|---|
| Sterling / Nikiski / Kenai / Soldotna | +$300 |
| Kasilof to Homer, Cooper Landing | +$400 |
| Anchorage & Seward | +$500 |
| Mat-Su (Wasilla, Palmer, and between) | +$500 |
| Fairbanks | +$1,000 |
| All other Alaska locations | +$1,500 |
Most residential properties, even with added complexity, come in well under $1,000.
Frequently asked questions
Is this the same as an appraisal? No. A replacement cost estimate is a standalone construction cost calculation, not an opinion of market value, and it isn’t prepared under USPAP. It’s intended specifically to support insurance coverage decisions, not lending, legal, or other purposes that require a full appraisal.
Why not just use my insurance agent’s estimate or an online calculator? Agents and free online tools often aren’t trained to correctly grade construction quality, classify occupancy type, or account for the finish-level and fixture details that drive real cost differences — and it shows in how often the resulting number is wrong. Getting a replacement cost estimate right takes real expertise, not just data entry.
Can a real estate agent’s CMA or a Broker Price Opinion (BPO) work instead? No — a CMA or BPO estimates what a property would sell for, based on comparable sales. It has no cost-approach component at all and doesn’t answer the construction-cost question insurance coverage is actually based on. Using one for this purpose can create false confidence in the wrong number.
Do you offer this outside Alaska? Yes — the desktop estimate is available nationwide. The in-person site visit option is currently available only in Alaska.
What if my commercial property is only insured to my loan balance? That’s a common and costly gap. A lender’s minimum protects the lender’s collateral position, not your equity in the building — and most commercial policies also carry a coinsurance clause that can reduce your payout on any claim, not just a total loss, if your coverage falls short of the required threshold. A replacement cost estimate gives you the actual number to check your coverage against.