by info_2 » Thu Apr 16, 2009 02:36 am
Recoverable depreciation is the difference between the cost to replace or repair property and its value before the damage occurred. Recoverable depreciation is the maximum amount of money you can recover from your homeowners insurance company after you have some repair or replacement work on you home. Items that your recoverable depreciation insurer considers recoverable and non-recoverable must be mentioned in the loss settlement provision of your homeowners policy.
Recoverable depreciation can be an important part of your homeowners insurance policy, especially if you need extra money. Homeowners insurance has 2 specific clauses that you may include in your policy. One clause concerns recoverable depreciation.
Recoverable depreciation can be an important part of your homeowners insurance policy, especially if you need extra money. Homeowners insurance has 2 specific clauses that you may include in your policy. One clause concerns recoverable depreciation.
How can you claim recoverable depreciation?
Here are a few simple steps you may follow in order to make your recoverable depreciation insurance claim:
- Review the policy: A claim for recoverable depreciation cannot be made on the actual cash value (ACV). Look at your policy carefully, and look for the recoverable depreciation clause.
- Gather evidence: Your insurance company will require evidence that you repaired your home or replaced the property before they will allow a recoverable depreciation claim. The adjuster will need documents that will help him confirm the value of the house after the damage has occurred.
- Contact the insurance agency: Once you've contacted the insurance company, either online or over the phone, the adjuster will do an appraisal of your home in order to estimate the amount of damage they will compensate you for.
- Depreciation check: Once the insurance company has allowed your claim, they will send you a check. The amount of the check should be the sum of your assets and depreciation minus the deductibles. The check may be made out to you, your mortgage lender, or both of you depending on the value of the check. If it is made out to you and your lender the check must be endorsed by the bank, which will deposit your share into your account.
Related readings
- When can you claim recoverable depreciation?
- Recoverable depreciation after hail damage
- Is there a deadline to file for recoverable depreciation?
- Mortgage settlement and recoverable depreciation
I have a claim that includes some other cosmetic work. To give an example.
My recoverable depreciation is 1K, My deductible is 2.8K. Total settlement is 13.9K. I don't have any mortgage on the house. The first insurance check settlement amount - deductible - recoverable dep = 10.1K. Now my question is if I decide to get the necessary repairs within the 10.1K amount, do I have to still care about recoverable depreciation? I am willing to forgo the recoverable depreciation by trying to fix everything using the first check. Do I still need to submit the work receipts to insurance company if I don't care about getting the recoverable expense? Can the claim close once the timeline to file for recoverable depreciation lapses (usually 180 days).
My recoverable depreciation is 1K, My deductible is 2.8K. Total settlement is 13.9K. I don't have any mortgage on the house. The first insurance check settlement amount - deductible - recoverable dep = 10.1K. Now my question is if I decide to get the necessary repairs within the 10.1K amount, do I have to still care about recoverable depreciation? I am willing to forgo the recoverable depreciation by trying to fix everything using the first check. Do I still need to submit the work receipts to insurance company if I don't care about getting the recoverable expense? Can the claim close once the timeline to file for recoverable depreciation lapses (usually 180 days).
Posted: Fri Jun 03, 2011 04:38 am Post Subject: aNKITrQLLpwyRdswhG
Recoverable depreciation.. Retweeted it :)
Posted: Wed Aug 10, 2011 12:34 am Post Subject: recoverable depreciation
Who gets the RD check funds, the contractor or the insured. Can the insured keep the recoverable depreciation check from the insurer?
Posted: Wed Aug 10, 2011 05:25 am Post Subject: hello
very much thankful i have my home insured to a good insurance company home owners insurance houston
Posted: Tue Apr 17, 2012 08:11 pm Post Subject: recoverable depreciation
I am trying to confirm if insurance companies call the contractor to confirm the documents they send are legitimate...I ask because my roofer barely answers the phone and cant keep a darn thing straight...it has been like working with an ADHD child and bottom line I dont want delays or to not get paid because this guy is an idiot.
Posted: Thu Apr 19, 2012 05:00 am Post Subject:
I am trying to confirm if insurance companies call the contractor to confirm the documents they send are legitimate
Not unless they suspect something fraudulent.Posted: Wed May 02, 2012 12:16 pm Post Subject: insurance
Yes, since to collect it you have to pay it yourself.
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Posted: Sat May 05, 2012 01:50 pm Post Subject: recoverable depreciation
just had roof replaced; solving a leak problem...cost was $8000...insurance not involved. My deductible is $2000, IF they DID accept claim. Is this a different way of getting my homeowner's insurance to cover the cost?
Posted: Sat May 05, 2012 03:12 pm Post Subject:
Is this a different way
Yes, it's certainly a different way . . . the WRONG WAY.
You have done this bass-ackwards. If you even thought your homeowner's insurance might have paid for the repairs, you should have contacted them first.
Don't even try it now. They will laugh you all the way out of the building.
Posted: Sat Aug 11, 2012 01:54 pm Post Subject: Greed
It seems as though more and more insureds have the idea that they can make thousands of dollars off their claims. I'm a contractor and have run across this a lot. I will do the leg work to get everything possible from the insurance company so I can absorb deductibles and do free material upgrades. The homeowner sees the dollar amount that I will get and decides to find someone cheaper. The insurance company will only pay what is billed for. YOU CAN'T KEEP MONEY!!! IT'S FRAUD!!! Why do you think they hold some of the money back? Insurance companies are in the business of making money and repairing damaged property. We buy insurance so if our property gets damaged we can get it fixed. When a contractor bills an insurance company, that insurance company will W9 (tax form) the contractor, thus he must pay income taxes on what is received. A homeowner should not have income from an insurance company unless they are employed by them. I understand the want and need for money, but the system is set up so the homeowner does not keep money. Pick a contractor you trust and let them make the money they earn, even if it's more than you think it should be. Unless you'd rather have your insurance company keep it along with all of your premiums.
Posted: Sat Aug 11, 2012 09:55 pm Post Subject:
Bill is quite correct. Insurance is not premised on providing anyone a profit. The insurance company promises to pay the Actual Cash Value of a loss, and may include a replacement cost increase. A contractor is not expected to work for free, and, personally, I think contractors are wrong to figure out how to include a homeowner's deductible in the final billing to the homeowner.
The insurance payment to the contractor is not profiting the homeowner, and the contractor is being compensated by the homeowner with insurance company money. It's the same as having your medical insurance pay a doctor's bill. The doctor does not customarily try to find a way to include the patient's deductible in his bill.
The homeowner agreed to absorb those first few hundred or thousand dollars in exchange for a lower premium. When the contractor "does the homeowner a favor" as Bill suggests, the homeowner has a "gain" -- not at the insurance company's expense, but at the contractor's. I know times are tough, and there's a lot of competition for small construction jobs, and it's probably impossible to get all the contractors onto the same page. But you fellows/ladies who perform these insurance repairs are cutting your own throats. Why do that?
If the homeowner thinks the job can be done for less, then let him do it himself -- if he can. Otherwise, state your price, and earn a decent living, and provide for your family.
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