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Fire & Water - Cleanup & Restoration

Insurance Reconstruction - What is Recoverable Depreciation?

9/9/2017 (Permalink)

Insurance policies can be confusing.

This is an amount of money withheld by the carrier to ensure your repairs are made and ensure it costs the insured the full amount to repair the property.

Here is an example:

  • Actual estimated amount of the claim: $10,000
  • Customer Deductible: -$1,000
  • Recoverable Depreciation Withheld: -$2,000
  • Actual Cash Value payment made to insured: $7,000

In this example for a $10,000 claim, the insured would receive a check for $7,000 to repair the property.

Once the work is completed and the total cost of the repair has been incurred, the insured can file with their insurance carrier for the recoverable depreciation.  In this example the recoverable depreciation payment would be $2,000 to the insured once the work was complete.

Have questions about insurance reconstruction? Call SERVPRO of Milton / Braintree Today – 781-341-7007.

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