Spring is here in Nebraska and if you are like many you are already dealing with severe thunderstorms.
When hail storms, lightning strikes or tornadoes happen you might be digging out your policy to see what you are covered for.
If your property is damaged and you file a claim, there are a couple of ways the repair/replacement will take place.
You could receive full value replacement, or an actual cash value replacement.
So you might still be asking, what exactly does actual cash value mean?
When "actual cash value" is used in a policy, a policy owner is entitled to the depreciated value of the damaged property.
In other words that means the insurance company takes the Current Replacement Cost – Depreciation = Actual Cash Value of the item.
The reason behind this is that it recognizes the reduction of value as the property ages, becomes obsolete, and is subject to wear and tear.
In some cases you can talk to your insurance agent and they will guide you on what requirements it takes to have a different valuation method for your items if possible.
This method of valuation can apply to personal property, your roof, your actual home, additional structures like awning or window coverings, and etc.
Many times “actual cash value” will be abbreviated to ACV.
A common example of when ACV is used in a policy is if a roof on a home is getting old or worn down, the insurance company will likely tell you to either replace the roof before something bad happens or that damages will be moved to an actual cash value basis.
A homeowner may be asked by a contractor to sign an agreement whereby the homeowner assigns all rights and benefits under his insurance policy to the contractor. The homeowner usually does not even realize he has done this, or doesn’t understand the implications of it.
Why this is an issue is because assignments of benefits are NOT necessary.
Claims are already hard enough to go through and with these storms passing through the area, scammers are already targeting homeowners!
If you have suspicions about a contractor that comes to your door, deny the service and find a trusted contractor. If you are unsure about who to trust, work closely with your insurance adjuster and agent. They work with claims frequently and will have trusted business relationships with genuine contractors.
We are here to serve YOU first!
Insurance carriers require that an insured party insure at least 80% of the property's value in order to collect a partial loss in full.
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