{"id":1297,"date":"2019-11-03T13:55:26","date_gmt":"2019-11-03T19:55:26","guid":{"rendered":"http:\/\/www.stevenkohnle.com\/?p=1297"},"modified":"2019-11-18T12:15:42","modified_gmt":"2019-11-18T18:15:42","slug":"will-your-roof-be-replaced-using-actual-cash-value-or-replacement-cost","status":"publish","type":"post","link":"https:\/\/stevenkohnle.com\/es\/will-your-roof-be-replaced-using-actual-cash-value-or-replacement-cost\/","title":{"rendered":"Will Your Roof be Replaced Using Actual Cash Value or Replacement Cost?"},"content":{"rendered":"

With Wind & Hail Season Coming Up…Will Your Roof be Replaced\u00a0Using\u00a0Actual Cash Value or Replacement Cost?<\/span><\/strong><\/h4>\n

There are several different methods by which your insurance company may calculate the amount it will pay you for a loss. Payment based on the replacement cost of damaged or stolen property is usually the most favorable figure from your point of view, because it compensates you for the actual cost of replacing property. If your roof is damaged by a hail storm, a replacement cost policy will reimburse you the full cost of replacing it with a new roof\u00a0of like and kind. The insurer will not take into consideration the fact that your roof is, for example,10\u00a0years old.<\/p>\n

In contrast, actual cash value (ACV), also known as market value, is the standard that insurance companies arguably prefer when reimbursing policyholders for their losses. Actual cash value is equal to the replacement cost minus any depreciation (ACV = replacement cost \u2013 depreciation). It represents the dollar amount you could expect to receive for the item if you sold it in the marketplace. The insurance company determines the depreciation based on a combination of objective criteria (using a formula that takes into account the category and age of the property) and subjective assessment (the insurance adjuster\u2019s visual observations of the property or a photograph of it). In the case of a damaged roof, the insurance company would deduct from its replacement cost an amount for all the wear and tear it endured prior to the time it was damaged.\u00a0 In the example above, that the roof was 10\u00a0years old.<\/p>\n

What Does \u201cReplacement Cost\u201d Mean?<\/strong><\/p>\n

The term \u201creplacement cost<\/em>\u201d is defined or explained in the policy. Simply stated, it means the cost to replace the property on the same premises with other property of comparable material and quality used for the same purpose.<\/p>\n

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What is \u201cActual Cash Value\u201d?<\/strong><\/p>\n<\/div>\n

The term \u201cactual cash value<\/em>\u201d is not as easily defined. Some courts have interpreted the term to mean \u201cfair market value,\u201d which is the amount a buyer would pay a seller if neither were under undue time constraints. Most courts, however, have upheld the insurance industry\u2019s traditional definition: the cost to replace with new property of like kind and quality, less depreciation<\/p>\n

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So What\u2019s the Difference?<\/strong><\/u><\/p>\n<\/div>\n

The only difference between replacement cost and actual cash value is a deduction for depreciation. However, both are based on the cost today to replace the damaged property with new property.<\/p>\n

Have you checked your policy – which one do you have?\u00a0 And should the need arise, which one do you want to have?<\/p>\n

Get the right coverage for you. Ask if you qualify for the most discounts in insurance!<\/p>\n

Feel free to email us or give us a call for more information!<\/p>\n

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With Wind & Hail Season Coming Up…Will Your Roof be Replaced\u00a0Using\u00a0Actual Cash Value or Replacement Cost? There are several different methods by which your insurance company may calculate the amount it will pay you for a loss. Payment based on the replacement cost of damaged or stolen property is usually the most favorable figure from […]<\/p>\n","protected":false},"author":2,"featured_media":1364,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[17],"tags":[41,39,26],"class_list":["post-1297","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-homeowners-insurance","tag-farmers-insurance","tag-home-insurance","tag-property"],"_links":{"self":[{"href":"https:\/\/stevenkohnle.com\/es\/wp-json\/wp\/v2\/posts\/1297","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/stevenkohnle.com\/es\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/stevenkohnle.com\/es\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/stevenkohnle.com\/es\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/stevenkohnle.com\/es\/wp-json\/wp\/v2\/comments?post=1297"}],"version-history":[{"count":0,"href":"https:\/\/stevenkohnle.com\/es\/wp-json\/wp\/v2\/posts\/1297\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/stevenkohnle.com\/es\/wp-json\/wp\/v2\/media\/1364"}],"wp:attachment":[{"href":"https:\/\/stevenkohnle.com\/es\/wp-json\/wp\/v2\/media?parent=1297"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/stevenkohnle.com\/es\/wp-json\/wp\/v2\/categories?post=1297"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/stevenkohnle.com\/es\/wp-json\/wp\/v2\/tags?post=1297"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}