How do you get depreciation back from insurance?
Short answer. To get depreciation back, you need a replacement cost policy, the damaged property actually repaired or replaced, and proof sent to the insurer within the policy's time limits. The most common reasons people do not get all of it back are a missed deadline, an invoice that does not match the estimate, or a roof covered only at actual cash value.
The pitfalls that cost homeowners money
- Waiting too long. Policies limit how long you have to repair and claim the holdback. Ask your adjuster for the deadline at the start.
- An invoice below the estimate. If your contract was cheaper than the insurer's figures, the release is limited to what you paid. Upgrades you pay for do not increase it.
- Work that never happened. If an item on the estimate, like gutter replacement, never got done, its depreciation is not released.
- Combined invoices. An invoice that mixes insured work with upgrades can make a reviewer hold the whole release. Separate them.
- An ACV roof. If the roof is on an actual cash value or schedule endorsement, there is no roof depreciation to recover, though other items may still be recoverable.
Do this instead
- Read the loss settlement section of your policy and note the time limit.
- Sign a contract for the insured scope.
- Get supplements approved before the final invoice goes in.
- Submit the invoice and photos, and ask for an expected release date.
If the insurer pays less than you expected, ask for a line-by-line explanation of what was released and what was not. Most shortfalls trace back to one specific line.
Related: recoverable depreciation on a roof, roof supplements, and roof payment schedules.