Getting Reimbursed for Replacement Cost Driving Me Nuts!

[baltimorebill]

I had a significant water loss-all three floors of a townhome including contents damaged from a broken toilet while I was on vacation. Home reconstruction went fine, if stressful. Back in house after 6 months. But the property adjuster was new, uninformed, overwhelmed and only modestly helpful. She was fired/quit (without me being informed), and then the case manager took over for a short period, then assgned me to a new property adjuster. I have asked some questions 8-10 times. With that backdrop, here is my question: My policy had replacement value on the many hundreds of lost items and I received actual cash value of about 40% of the replacement value. Would the insurance company be willing to settle with me, perhaps paying me 50% of the difference between replacement value and the actual cash value? That would be preferable to this endless stream of emails and mounds of paperwork. Should I ask about this? If so, how phrase?

 

[djs]

No, they won't 'settle' with you in the way you suggest. They will honor your policy as it is written.

Here's the deal and where most people get lost.

The initial payment is for Actual Cash value on personal property. This is what I read from your description, your $1000 couch was worth $400 on actual cash value, so that is what they paid you. You want the $1000, which is understandable.

Now, when you ACTUALLY replace the couch, with a similar quality / function couch (same one helps), they will write another check for the remaining amount, up to the value of the original couch new. This might be another $700 because it cost you $1100 to replace the couch with the same couch, due to inflation.

So the catch is that replacement value only comes into play when the item is actually replaced, not on the loss. At the loss, you get actual cash value.

If you have items you don't replace, then most policies will only pay actual cash value. No amount of 'negotiating' will get a carrier to pay more on those items.

That said, there is almost always a bunch of fine print to insurance policies. Your adjuster should have explained this to you, but I've had to re-explain it to many clients since it gets lost in the emotions of the loss. In your case, your adjuster may not have ever walked you through it correctly. Ask your current adjuster, but be prepared to listen intently. Let them explain it, then walk through some actual examples to make sure it fits.


Dan

 

[baltimorebill]

Thanks Dan~ But it feels like the insurance company can then minimize their losses by not replying, requiring re-submission of information, etc., to the point that I become discouraged; I'm almost there now....