After property damage, you may be left with thousands of dollars worth of damaged contents. Perils like water damage, fire damage, smoke and soot damage, and mold damage can all affect your personal belongings like clothing, furniture, and electronics. When filing an insurance claim, you may see the words “depreciation” and “contents damage“. But what do they mean? What is contents damage depreciation in RI?
What is Contents Damage?
A large aspect of any insurance policy is the contents damage insurance. This is the coverage for the contents of your home such as furniture and appliances. This can either be listed as “contents insurance” or “personal property coverage”. This type of coverage helps replace and repair any belongings that have been lost due to any peril that is covered by your insurance claim. For example, any clothing or furniture lost in a house fire will be covered due to having good contents insurance.
What Is Depreciation?
Depreciation is the decrease in the value of the items damaged in a loss. The insurance company will take a look at what the items were when they were first purchased versus what they are worth now.
How Do My Contents Get Depreciated in RI?
Contents depreciation value is calculated based on formulas and calculations made by both the insurance company as well as your public adjuster. One of the most complicated aspects of a property damage claim is the payment structure. The payment structure starts with the replacement cost value or RCV. This is the amount of money that the insurance company believes that it will cost you to repair your home or personal property. They then depreciate based on the age of the items and parts of the home that were damaged. That brings you to your actual cash value or ACV for short. This is what they believe everything was worth at the time it was damaged. They then take off the deductible and that leaves you with your net claim which will be the amount of your insurance check. Each insurance company has formulas that it will use and the majority of them revolve around both age and life expectancy.
What To Keep In Mind For Contents Damage Depreciation In RI
It is important to know that only the name(s) listed on the contents insurance policy will be covered by the insurance company from the damage due to any peril. This means that guests or roommates who are staying in your residence will not have any coverage for their personal items if an incident were to occur. Your type of contents coverage can be based on multiple factors: type of coverage (named or opened perils policy), the limit of your contents, whether or not you have ACV coverage, deductibles, and high-value items. There are certain limits to keep in mind, this limit is usually a percentage of the insured dwelling amount which can range between 50% to 70% based on your situation. Contents coverage is typically part of a homeowner’s insurance policy but it is important to make sure that you and your contents are covered by the insurance policy you currently have or plan to get.
How Can I Make Sure I’m Fairly Compensated?
You could leave this all up to your insurance company to accurately calculate and payout for your contents damage depreciation in RI. Typical homeowners may not know all of the information they need to know about contents damage depreciation in RI to catch any mistakes the insurance company might make. This option could leave you with hundreds to thousands of missing dollars for the damage. Hiring a public adjuster will ensure that you get every penny you need to either clean or replace your damaged personal property.