Don’t let an accident, fire, water damage, vandalism, or theft cause you, your family, or your business financial burden. Learn more about insuring to value and the difference between replacement cost, actual cash value, and market value.
Is your home or business adequately insured?
Rebuilding a home or business is often more expensive than new construction. Contacting a local contractor to request an estimate for replacing your home or business can help determine the value of the structure.
You can estimate the replacement value of your personal property such as furniture, equipment, electronic devices, clothing, and even the items in your kitchen by keeping record of receipts. Have items such as antiques, jewelry, valuable artwork, or other hard-to-replace items appraised and include the total in your valuation. It is important, if you have to file a claim, that you have a complete and accurate home inventory.
In your business, take inventory of your stock and estimate the average value of the product you have on hand. Keeping purchase orders and receipts will also help determine how much your inventory is worth in the event of a loss.
Be sure to visit with your agent about the following insurance terms and what they mean to you and your insurance cost and coverage.
What is replacement cost?
Replacement cost is the cost to replace an item or property after it has been destroyed or damaged beyond economical repair with a new, replacement item or property. This applies unless the limit of insurance or the cost actually spent to repair or replace the damaged property is less.
What is actual cash value?
Actual cash value is the cost to replace an item or property with a new item or property of like kind and quality, less depreciation. The formula used to figure actual cash value is replacement cost – depreciation.
What is depreciation?
Depreciation is the deduction in value of an item or property based on the age and useful life of that item or property.
What is market value?
Market value is the value assigned to an item or property because of its location or economic desirability. It is the price that the item or property would be worth in an open and competitive market or at auction.
Contact your agent to learn more
Be sure your insurance policy provides the necessary coverage you need should disaster strike. Contact one of our agents today to review your current policy or to get a quote for your home, personal property, or business.
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