they shouldn't rebuild--they know it's going to burn again.

[MindPilot]

I'm seeing this comment with considerable frequency. So please let me explain that it is not that easy. You have a mortgage based on the market value of a piece of property with a house on it. Part of the contract with the lender is that you will maintain the value of that property. Having insurance is part of that. If the house is destroyed, the insurance does not pay you the value of the house just before it was destroyed, they pay to have it rebuilt, which is a big difference. My 800,000 house would cost about 250,000 to rebuild. So the bottom line is that most people have no choice. Even if you own the house free and clear, you still own the property and couldn't legally just walk away from a pile of ashes in a vacant lot.