The insurable value is the amount required to rebuild a house and improvements in the event of a fire, flood, or other disaster. The insurable value does not include land.
Example: A 10-year-old house with lot is worth $100,000. The lot alone is worth $25,000. It will cost $90,000 to rebuild the house in case of fire. The market value of the property is $100,000 and the insurable value is $90,000.