To maximize your recovery, it is vital to understand Actual Cash Value and the rights you have regarding Actual Cash Value. Actual Cash Value coverage is a property valuation method that says your policy will pay to replace your home, business and property belongings with items of “like kind and quality” at current prices, MINUS all of the applicable (and very subjectively-determined) Depreciation.
Actual Cash Value coverage is a policy condition you need to determine if you have. Actual Cash Value (depreciated Replacement Cost Value) policy coverage is usually less favorable than Replacement Cost Value coverage, since it compensates you for the replacing/repairing of the damaged real and personal property at a depreciated amount.
As an example, if your bedroom furniture is destroyed in a flood, an Actual Cash Value policy will consider the usage and age of the property, and pay you for the depreciated cost of replacing it with like kind and quality.
Here are some tips to help you recover the most legitimate payment from your Actual Cash Value policy:
- Find your proof of purchase. Receipts are best, otherwise create a detailed description of model number, date of purchase, and other details to describe the lost item. Photos or videos of both the real and personal property are also very helpful as records of your lost/damaged property. You might also have canceled checks or charge card records, or maybe warranty information describing them.
- Take photos of the damaged or destroyed property. Before you discard the damaged property, take photos or video to show the destroyed condition.
- Get written estimates or bids before talking with the adjuster. Go shopping for the item in question. Get proof of pricing and Replacement Cost Values.
- Prepare a List of Actual Losses. Include furniture, appliances, clothing, paintings, artifacts, food and equipment, regardless of you intent to replace the objects.
- Prepare Your Claim. Write down the itemized damages on your claim. Be sure to attach photos, contractor estimates (in extreme) detail, and detailed descriptions, receipts, and proof of your losses.
- Try to fully recover for your damages. But, don’t believe that any settlement is final, or that any settlement is fair. It is common for insurance companies to offer settlements at the lowest range of their payout scale.
If you need additional advise or counsel to help resolve issues like this, please feel free to contact The Rector Law Firm at (719) 578-1106.