Insurance Restoration Gap Calculator

Insurance rarely covers full restoration. This calculator sizes the owner out-of-pocket gap.

Restoration cost

Insurance recovery

Code upgrade cost

Betterment scope

Restoration gap

$145,000

Covered shortfall

$85,000

Recovery %

65.48%

How the math works

Gap = (restoration − betterment − code − recovery) + code + betterment. Covered shortfall isolates the insurance-driven portion.

Write code upgrade quotes as separate estimate lines so carriers can scope ordinance-or-law coverage cleanly. Commingled numbers lose eligible reimbursement inside the covered loss and shift it to the owner.

How to Use

Enter actual restoration cost.
Enter insurance recovery (net of deductible).
Enter code upgrade cost.
Enter betterment/upgrade scope.
Read restoration gap.

Frequently Asked Questions

Gap sources?

ACV depreciation (roofs, HVAC, finishes lose 30-60% of RCV after 10 years). Code upgrade requirements beyond matching-like-kind. Owner-elected upgrades (betterment). Deductibles. Underinsurance via coinsurance. Each stacks on top of the raw claim.

Code upgrade coverage?

Ordinance or Law coverage (Coverage A/B/C) pays for code-driven rebuild requirements. Without it, owner pays entire delta between matching-like-kind and current code — often 15-30% of restoration cost on older buildings.

Betterment decisions?

Restoration is rebuild opportunity. Kitchens, bathrooms, HVAC upgrades during restoration cost less marginally than standalone remodel (tear-out already done). Budget betterment separately from covered loss.

When does a lender negotiate vs foreclose?

Lenders calculate their net recovery from foreclosure (asset value minus legal, time, and sale costs) and compare to any workout proposal. If your offer nets the lender more than foreclosure, and you present it with clear sources of capital, most lenders will engage. Bring a credible sponsor, documented sources, and a timeline — vague asks get declined. Build the relationship before distress, not after.