This article is for general information purposes only and does not constitute legal, tax, or financial advice, nor a valuation in an individual case. Despite careful research, we assume no liability for accuracy, completeness, and timeliness. For specific questions, please consult a lawyer or tax advisor. Older content may be outdated due to changes in legislation or case law.
Building insurance is based on the 1914 replacement value, a historical construction price index, which is extrapolated to current new-build costs using a construction price index.
This value takes into account only the costs of structural reinstatement, but not the land value, the location, or the current market demand for the property.
For sale, inheritance, or lending purposes, the more comprehensive market value is therefore always decisive, whereas the replacement value serves purely insurance-related purposes.
The construction price index used to extrapolate the 1914 base value is regularly published by the Federal Statistical Office and adjusted annually by insurers.
In the event of a total loss, the insured party generally receives the funds to rebuild an equivalent building, regardless of the market value the property would actually have achieved on the market most recently.