The two blogs which I have written over the weekend, Replacement Cost Policies Were Originally Illegal Out of Concern For Fraud and Arson and  Should Depreciation Be Taken On Partial Losses Requiring Only Repair?, deal with older form polices written before the industry made replacement cost policies commonly available. The study of an insurance topic from an historical view is important. Those trying to come to a more thorough understanding of property insurance law cannot simply read the insurance cases and then start reciting that case law without trying to find the applicable policy being interpreted. The historic context of the policy forms, insurance industry comment and laws at the time have to be considered. The case law is just part of a complete legal understanding.
Continue Reading Reflection About Historical Policy Change and Depreciation of Partial Losses Requiring Only Repair

When I was a young attorney, one of the issues which always came up at property insurance adjuster conferences was whether it was appropriate to take depreciation when only a repair was needed to a partial property loss.  This adjustment concept seems to be lost in newer debates raised by insurance companies who want to depreciate and not pay for anything until replacement or repair is made and paid.
Continue Reading Should Depreciation Be Taken On Partial Losses Requiring Only Repair?

Public adjuster Stephen Sarasohn wrote a comment to my recent post, Actual Cash Value Proof Is Important Under Most Replacement Cost Policy Disputes. The comment section sometimes gets lost because it is so far underneath the blog post. But his comment raises an important Florida Supreme Court case1 everyone should study and consider when dealing with partial losses where actual cash value is not defined and for policies not defining the value to be insured when considering coinsurance issues. The one caveat is that this is an older form policy.
Continue Reading An Important Florida Case Regarding Actual Cash Value of a Partial Repair and Coinsurance Sound Value That Public Adjusters Should Study

Louisiana Act 345 will have an immediate impact on Louisiana property insurance claims from Hurricane Ida. The law just became effective on August 1, 2021, without much publicity. Hurricane Ida has done significant damage in Louisiana, and everybody involved in the claims process should carefully consider this new law.
Continue Reading New Louisiana Property Insurance Law Impacts Hurricane Ida Claims

Are California homeowners entitled to collect actual cash value (“ACV”) or replacement cost values (“RCV”) for property claims? It depends on what type of policy you have and whether you suffered a total or partial loss of your property. What’s more, in a few weeks, the California Assembly may vote to change existing law. To understand what homeowners are entitled to, we must first determine whether the policyholder has purchased an RCV or ACV policy and to analyze impact of depreciation.
Continue Reading Potential Changes to California’s Insurance Code Section 2051 Impacts Total loss Valuation on ACV Policies

Whether your insurance company forced you to sift through soot and ash, trying to recollect what has just been stolen, or trying to identify items damaged by water, going through damaged contents and creating an inventory is an emotionally draining experience that typically comes with little to no guidance by the insurance company. After spending countless hours substantiating lost personal property contents, the insurance company responds with random, and sometimes substantial reductions in the value of the personal property for depreciation, often with little to no explanation as to how it arrived at that conclusion.
Continue Reading Explaining Depreciation of Personal Property Contents in Colorado

The California Department of Insurance recently issued a press release announcing that the California Supreme Court affirmed the homeowner reimbursement protections recently decided in California Fair Plan Association v. Garnes.1 Back in June, my colleague Kevin Pollack wrote about the recent decision and whether actual cash value means fair market value or replacement

Most judges and insurance regulators have never worked in property insurance claims departments. For that matter, few insurance attorneys have either (Merlin Law Group’s Javier Delgado worked his way through school as an independent adjuster). But, when I was starting out, an older and experienced GAB adjuster told me they never depreciated labor and the deprecation of repairs rarely occurred.
Continue Reading Few Judges and Insurance Regulators Worked in Property Claims: Understanding New Depreciation Rulings

On August 1, 2017, The Arkansas Insurance Department issued Bulletin 10-2017 that rescinds Bulletin 13-B-2013.1 Specifically, Bulletin 10-2017 states “any prior communications or notices from the Arkansas Insurance Department. . . that prohibited depreciation of labor, are hereby rescinded.”
Continue Reading New Arkansas Insurance Department Bulletin on Depreciation of Labor

While I often argue that depreciating labor simply does not make sense, insurers continue to push the question of whether the depreciation of labor costs in Actual Cash Value policies is acceptable. Though several jurisdictions have rejected the depreciation of labor, surprisingly, the recent trend of jurisdictions touching upon the subject has been to allow for the depreciation of labor.
Continue Reading Colorado Joins a Growing List of Jurisdictions Allowing Depreciation of Labor Costs When Determining Actual Cash Value