Traditionally, homeowners insurance included full replacement value coverage for portions of your home such as your roof. However, many insurance companies have changed this clause in their policies, and now homeowners can only expect actual cash value if something happens to their roof. When it comes to roof claims in Corydon, IN, it’s vital to familiarize yourself with your policy and feel comfortable asking your insurance agent questions when you’re unclear.
Actual cash value vs. replacement cost value
When a natural disaster happens, we receive many questions pertaining to how roof claims work in Corydon, IN. The most important aspect of your homeowners policy regarding your roof is whether you have actual cash value (ACV) or replacement cost value (RCV) coverage.
If your policy stipulates ACV coverage, then your insurance will only pay for what your roof cost when you file your claim. A roof’s age and overall condition is taken into consideration when determining the ACV. This is to ascertain how much it has depreciated since it was originally installed.
RCV coverage on your homeowners policy means your insurance covers the entire cost of replacing your roof, not including your deductible. Policies with RCV coverage have higher premiums than ACV ones, and for good reason. RCV policies provide the coverage you need should something happen to your home.
For example, let’s say you have a $1,000 deductible and your $15,000 roof has depreciated by $1,000 every year since it was installed a decade ago. After a horrific hail storm, your roof requires work totaling $15,000. With an RCV policy, you would only pay that $1,000 deductible. However, an ACV policy would require you to pay $11,000 out of pocket.
Which option makes sense for you?
No two homes are the same, which means the only way to properly determine what type of homeowners insurance makes the most sense for your family is to speak with an experienced insurance agent, such as those at the Harvey Sarles Insurance Agency.
However, if your home is older, you’ll want to make the investment into a policy with RCV valuation methods. Newer homes or homes with newer roofs usually have the coverage required with insurance policies that include an ACV valuation method.
Why do people choose ACV policies?
It seems that a homeowners policy that includes RCV coverage is the best choice, but many argue that the savings on premiums with policies that have ACV coverage are enough to cover the costs of significant roof damage when the unthinkable occurs. Ultimately, homeowners policies are not one size fits all, and that’s why you should work with an insurance agency that understands you and your needs.
It’s not uncommon for people to call us to ask how roof claims work in Corydon, IN. For over 30 years, the community has trusted our team to help them with their roof claims, homeowners policies and everything else related to insurance. Get in touch with us today to discuss updating your existing policy or setting up a brand-new one for your home or vehicle.