Final Answer:
Lacey won't be able to purchase a replacement cost policy for the finished basement through the National Flood Insurance Program (NFIP) because NFIP typically provides replacement cost coverage for the building (structure) itself, but contents, including items in a finished basement, are usually covered on an actual cash value basis.
Step-by-step explanation:
The National Flood Insurance Program (NFIP) provides flood insurance coverage, including replacement cost coverage for the building (structure) itself. However, when it comes to personal property, which includes the contents of the home, NFIP generally provides coverage on an actual cash value (ACV) basis.
Actual cash value takes into account depreciation, meaning that the payout for damaged or lost items is calculated based on their current market value, not the cost to replace them with new items.
While the structure of the home may be eligible for replacement cost coverage, contents like those in a finished basement may not qualify for the same level of coverage.
Therefore, Lacey won't be able to purchase a replacement cost policy for the finished basement's contents through NFIP, and coverage for personal property in the basement would typically be on an actual cash value basis.