Did You Know?

What's the difference?

Replacement Cost versus Actual Cash Value. You see it a lot, but what does it really mean? Replacement Cost Value doesn’t take into consideration depreciation or wear and tear but reimburses an insured on how much it would cost to replace, repair or rebuild their property at today’s prices. Actual Cash Value factors in depreciation and normal wear and tear. It typically applies to personal property, but dwellings or structures that are not insured to at least 80% of their value would potentially fall under this category also. What this means is that in the event of a loss, any dwellings or structures that are not insured to 80% of their value would only receive the currently estimated value factoring in the depreciation and wear and tear. This could leave the insured responsible for a larger portion of a loss than they had expected. Actual Cash Value makes sense when there is an older dwelling or barn where there is no expectation to rebuild the structure if there is a partial or total loss. For newer structures, Replacement Cost allows for appropriate compensation to make needed repairs or to rebuild. Both Replacement Cost and Actual Cash Value are subject to deductibles and limits.

In a bad spot? We can help!

The increase of catastrophic events in states, such as CA, TX and FL, has led to the unfortunate need to limit the exposures in those states and to initiate non-renewal notices on properties within those locations. Even if the property is no longer eligible, we are happy to offer liability in the instances where such coverage is needed.

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