Replacement cost value much higher than what I bought the property for?
I am looking for replacement cost value DP3 insurance policies on my first rental property. I paid 71,500$ for the property, and it has brand new roof, plumbing, electrical, and floors.
I am being quoted for 171,000$ in dwelling insurance on DP3 policies. My question is
1) Am I over-insuring? Why are they insuring me at 171,000$ to rebuild the property when I can buy a new one for $71,500?
What am I missing here? Would it simply be enough to insure it at what I paid for it, because I don't see how the cost to rebuild can be higher than the cost of buying a new property?