Actual Cash Value Or Do I Need To Add Replacement Cost
Most standard Homeowners policies provide coverage for your items of Personal Property on an actual cash value basis which is the cost to replace the items minus depreciation because of age or use.
For an additional premium charge, you can buy Replacement Cost Coverage for your Personal Property.
Your Policy will then pay you the cost to replace any item without depreciation. For example, a ten year old couch may be worth only $400, but it would cost $1,200 to replace it today. With a Replacement Cost Endorsement, you would collect the full $1,200 cost to replace the couch, minus only the amount of your deductible.
NOTE: The insurance company you chose will pay the full replacement cost only if you actually replace the item. If you do not replace it and instead accept money, the amount will be on an "Actual Cash Value" basis.
Most Homeowner's Policies Have The Following Coverage Limitations
NOTE: These limits apply per claim for each category, not per item. There are, in addition, other limitations too, such as those applying to watercraft and recreational vehicles which can be better protected by purchasing separate policies.
- $200 - Money, silver, coins, medals, etc.
- $1000 - Securities, deeds, letters of credit, tickets, stamps, manuscripts
- $1000 - On watercraft, including their trailers, furnishings, equipment and outboard motors
- $1000 - On trailers not used with watercraft
- $1000 - On grave marker
- $1000 - Loss by theft of jewelry, watches, furs, precious and semi-precious stones
- $2000 - Loss by theft of firearms
- $2500 - Loss by theft of silverware, silver plated ware, gold ware, gold plated ware, pewter ware
- $2500 - On property, on the residence premises, used at any time or in any manner for any business purposes
- $250 - On property, away from the residence premises, used at any time or in any manner for any business purposes
How You Can Obtain More Complete Coverage On Your Valuables
These limitations can not only be increased, but much broader "all risk" coverage can be purchased for your valuables. A Personal Articles Floater, which is usually attached to your Homeowners policy, will give you "all risk" coverage for jewelry, furs, silverware, stamps and coins and many other personal items such as golf clubs, cameras, or musical instruments. The Floater Endorsement also can include fine arts items and antiques. All you have to do to obtain coverage for your valuables is provide us with a full description of each item you want to insure along with an appraisal or bill of sale.