April 12, 2010

A funeral home had a T-12 organ, which has not been manufactured since the 1970s, that was damaged beyond repair by fire. The insured has replacement cost coverage.

A similar, new organ is listed at $9,995 plus shipping and can be purchased on the organ company’s Web site.

The adjuster found a used T-12 on Craigslist for $1,000. Can the insurance company replace the organ with a used one found in this manner?

Kentucky Subscriber

If the used organ found on Craigslist is of comparable quality to the one that was damaged in the fire, then, yes, the insurer may use that organ as a replacement, as one of the loss settlement options is to replace with property of like kind and quality.