Do you get a depreciation check from insurance?
Short answer. Yes, if your policy pays replacement cost: the depreciation check is the second payment, releasing the depreciation held back from your first check, and it is sent after the work is completed and the insurer receives the final invoice. If your roof is on ACV terms, there is usually no depreciation check for the roof.
What the depreciation check is
Your first payment on a replacement cost claim is the actual cash value minus the deductible. The difference between replacement cost and actual cash value, the recoverable depreciation, is held back. The depreciation check pays that amount once the insurer confirms the work is done.
Where to find the amount
Look at the estimate summary for a line like recoverable depreciation or depreciation held back. That figure, plus any approved supplements and minus anything you did not end up spending, is roughly what the second check will be.
Who is on the check
- You, as the named insured.
- Often your mortgage company, which may need to endorse it; see mortgage company insurance checks.
- Sometimes the contractor, if you authorize it in writing. Georgia makes it an unfair practice for a contractor to take an assignment of your insurance proceeds within one year of a declared natural disaster, so read what you sign; see assignment of benefits in Georgia.
How to request it
- Finish the work within the policy's deadline.
- Send the adjuster the final invoice, with photos if requested.
- Ask the adjuster to confirm receipt and the expected payment date.
What it is for
The depreciation check is part of paying for the work you contracted. With a mortgage, it usually goes toward the contractor's final payment once endorsed. More on the process is in recoverable depreciation.