One of the most common questions we get from our customers regarding their insurance claim is “What is Recoverable Depreciation?”. The most basic way to describe depreciation is “the loss of value over time or due to deterioration”. Insurance companies use depreciation to value your roof when you file a claim.
The value of the roof with depreciation subtracted is known as the Actual Cash Value or ACV and is simply the insurance company’s calculation of the actual cash value of the roof at the time of loss, taking into account the age of the roof. If you would like to speak with one of our friendly staff to help walk you through what Recoverable Depreciation is all about, contact us today.
Calculate Depreciation
- Replacement Cost Value: $10,000 (Cost of Roof Today)
- Depreciation: -$3,000 (After Roof Damage)
- Actual Cash Value: $7,000 (Value of Your Roof)
Recoverable Depreciation
If depreciation is the loss of your roof’s value due to age, then “What is Recoverable Depreciation?” It’s the amount of depreciated value that the insurance company is willing to give back to you. You may also hear the term Replacement Cost Value (RCV), which is calculated as the Actual Cash Value (ACV) plus the Recoverable Depreciation. The most important factor regarding recoverable depreciation is whether or not you actually recover it!
Calculate Claim with Recoverable Depreciation
- Replacement Cost Value: $10,000
- Less Depreciation: -$3,000
- Actual Cash Value: $7,000
- Less Deductible: -$2,000
- Net Claim: $5,000
- Recoverable Depreciation: $3,000
- Net Claim w/ Recoverable Depreciation: $8,000
We understand that insurance claims can be confusing. Let the experts at Houston Roofing and Construction guide you through the entire insurance claim process, including understanding the ACV, RCV, Depreciation, and Deductible amounts. Contact us to learn more or to schedule a free, no-obligation roof inspection.