Under an Open Homeowner Insurance Policy Actual Cash Value for Contents is Cost to Repair, Rebuild, or Replace Less Depreciation

An open homeowner’s insurance policy requires payment of actual cash value for a structure’s contents, the measure of the actual cash value recovery is the amount it would cost the policyholder to repair, rebuild, or replace the thing lost or injured less a fair and reasonable deduction for physical depreciation based upon its condition at the time of the injury or the policy limit, whichever is less.

Any depreciation adjustments should be based on its market value at the time of the loss taking into consideration the condition and age of the property. Provided that the property can be repaired and replaced during the useful life of the property.

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