Home Insurance Recoverable Depreciation

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ND Fan 1
Posts: 341
Joined: Fri Oct 30, 2015 12:29 pm

Home Insurance Recoverable Depreciation

Post by ND Fan 1 »

Good Morning, we had a house fire and are working through a rebuild. We received a very detailed construction estimate from the insurance company that had the replacement value and actual value of every little item in the house, down to outlets, doorknobs, etc... We received the first lump sum check which was the total actual cash value, lets say $200K. Each line item had a replacement cost vlaue and that total was $100K. From my conversations with the adjuster once the house is rebuilt and inspected, they will release the Recoverable Depreciation and I will get the other $100K to pay off the contractor.

My question, is do they go line item by line item on the estimate to determine how much depreciation they will pay out? The estimate is 90 pages long with over 1000 line items. Plus some of the items are now behind walls.

So there some items we didn't replace because they were not damaged, and it some some places we changed some design and layout of the house. One example was the water heater, it was only 2 years old. The insurance company listed it for $1000 actual value and $1200 for replacement value. Since we didn't replace it will they not give us the other $200? That's an easy one to spot not being replaced, but what about plumbing lines or electrical lines? Stuff that is not as obvious. How will detailed will they be? A room called for 12 outlets and i only put in 11, will they count items like that?

My impression was, as long as the house was rebuilt in the similar manner and fashion and passed a construction inspection, they will release the full depreciation, without going line by line. But I want to make sure I am not costing myself some depreciation if I choose to not replace everything exactly line the estimate.
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