For repairs to be eligible for the replacement cost basis under homeowners insurance, the completion of repairs is essential. This criterion ensures that the homeowner has taken the necessary steps to restore the property to its original condition or improve it to a better standard. The replacement cost basis means that the insurance will cover the costs associated with repairing or replacing damaged property without factoring in depreciation, provided that the work has been finished according to the terms of the policy.
When repairs are completed, it validates that the costs incurred are indeed necessary and reflective of the current value of the property being restored. Insurers typically require that the repairs are carried out fully rather than partially, as this reflects the complete restoration of the asset in question, thereby allowing the homeowner to receive the full replacement value.
While approval from the insurer and documentation of loss may be part of the overall claims process, they are not requirements for the repairs to be considered eligible under the replacement cost provision. Partial completion, similarly, does not fulfill the eligibility criteria, as the full intention of the insurance coverage is to restore the property completely.