Is additional fire insurance needed?
Rebuilding costs can vary between properties, regions, and parts of the country. It is difficult to provide precise recommendations on what constitutes a reasonable rebuilding cost, but the following calculator can give you an indication of whether there is reason to purchase additional fire insurance.
As a reference, one can assume an average of ISK 550,000 to 650,000 per square meter for residential property. However, the cost may be higher or lower. You can enter information into the calculator by using the plus and minus buttons or by typing directly into the grey text boxes.
Construction cost per square meter in ISK
Total square meters of the property
Fire insurance valuation in ISK
Based on the figures above, the total reconstruction cost is:
0 ISK
We therefore recommend additional fire insurance in the amount of:
0 ISK
Fire insurance value
Information about fire insurance valuation can be found on the website of the Housing and Construction Authority (HMS).
In the Guide to Fire Insurance Valuation published by the Housing and Construction Authority in June 2025, it is stated that fire insurance valuations for housing in Iceland are generally underestimated by 4–8% due to the lack of reassessments following maintenance and renovations.