Fire Loss

by jim_1 » Sat Oct 09, 2010 08:14 pm
Posts: 10
Joined: 09 Oct 2010

My Coverage A policy states' " Buildings covered...the replacement cost of that part of the building damaged with material of like kind and quality. We will pay no more thatn the actual cash valuee of the damage until actual repair or replacement is complete."

The adjuster has depreciated our house by $30K after our fire; is this recoverable depreciation, or holdback; or can the insurance keep this 30K?

We are rebuilding.

Jim

Total Comments: 10

Posted: Sat Oct 09, 2010 10:15 pm Post Subject:

"...until actual repair or replacement is complete".

This is the answer.

Posted: Sun Oct 10, 2010 01:58 am Post Subject:

Thanks, that's what I thought. How can I get the depreciation down to a lower level and are different areas of the house depreciated at various rates? Another words, how do I get the amount lowered?

Posted: Sun Oct 10, 2010 02:22 am Post Subject:

You don't.... actual cash value is actual cash value.

For example... what is a used microwave worth? How would you go about proving that it's used value is more? You can always provide the insurance company documentation to show that the value of a used items is more but I just don't see that happening.

I see no need to get the amount lowered unless you are not going to have those repairs/replacement done.

Posted: Sun Oct 10, 2010 02:29 am Post Subject:

Understood ACV with Coverage C, but how does the adjuster calculate depreciation with Coverage A?

Posted: Sun Oct 10, 2010 02:36 am Post Subject:

Paint, carpet, shingles, ect... anything that suffers from wear and tear and/or would need to be replaced after time.

How it's determined is usually via chart that gives depreciation values based on age. For example, a shingle roof might be listed with a 20 year life expediency and a maximum of 80% depreciation. So if the shingles are 10 years old, it's depreciated 50%.

Posted: Sun Oct 10, 2010 02:43 am Post Subject:

OK, but for the dwelling depreciation, the depreciated amount (in this case 30K) is merely a "hold back" amount until repairs or replacement is completed, correct?

HO 003 Policy.

Posted: Sun Oct 10, 2010 03:06 am Post Subject:

Correct, as long as you have replacement cost coverage.

Posted: Sun Oct 10, 2010 07:43 am Post Subject:

There are charts that adjusters can go by or use their judgement. I normally took no more then 50% on any part of a dwelling. Drywall was usually low (less then 10%) paint and carpet were usually higher (25 to 40%). Some adjusters are lazy and take a common 20 to 25% across the board, which really shouldn't be done.

holdback and depreciation are the same thing. The word holdback is normally used with insured's as depreciation can be confusing and the word seems to get people nervous.

Posted: Mon Oct 11, 2010 01:42 am Post Subject:

how do I get the amount lowered?



Unless you are not intending to repair the damage or replace the lost property, you would not be concerned with that.

In fact, this larger depreciation is to your advantage, since the adjuster is saying that you could submit receipts and invoices for repairs and replacements up to $30,000 over the amount you have already been paid by the insurer, and they will not blink.

Posted: Wed Mar 30, 2011 06:18 am Post Subject: catch sufficiently

hello world

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