How do I receive Replacement Cost Value of Structure damage without depreciation?

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Nov 12, 2011

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Insurance Question from Fort Wayne, IN

Asked on 11/12/2011

How do I receive Replacement Cost Value of Structure damage without depreciation? INS quotes payment $65.12 for a $651.19(RCV) window is not fair. Total claim is $28,000. With depreciation, total payout will be $16,037. How can repairs be made for "like" product (plaster) with such cheap prices Actual Cost Value(Insurance will pay) is much less than RCV I have replacement cost coverage. How can I get them to pay?

Answer given on November 13, 2011

If your homeowner policy has replacement cost coverage, the insurance company is required to reimburse you for the full replacement cost of the damaged property less your deductible. However, most insurance policies have a clause that they will pay actual cash value, which is replacement cost less depreciation, until the property is actually repaired or replaced.If the adjuster is working with your contractor, the contractor should understand how the process works. They will install the damaged property and the insurance company will then pay them the difference between the actual cash value and the replacement cost. The insurance company will not usually pay you full replacement cost and then you go out and replace the property. The insurance company needs to see proof that the items were actually replaced such as by an invoice from the contractor.If you have an agent, they can explain the process to you. If not, the adjuster should explain it to you.

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