If a piece of jewelry is scheduled and the insureds Son turns in a claim saying his Mother is in a home & he just discovered the piece of jewelry is missing a year later. Can the piece be depreciated 50% until it is replaced then the remaining monies can be issued?
The loss settlement provisions should be in the schedule. We're looking at the ISO HO 04 61 03 22 Scheduled Personal Property Coverage. That form lists loss settlement as follows:
c. OTHER PROPERTY (1) THE VALUE OF THE PROPERTY INSURED IS NOT AGREED UPON BUT WILL BE ASCERTAINED AT THE TIME OF LOSS OR DAMAGE. WE WILL NOT PAY MORE THAN THE LEAST OF THE FOLLOWING AMOUNTS:
(a) THE ACTUAL CASH VALUE OF THE PROPERTY AT THE TIME OF LOSS OR DAMAGE; (b) THE AMOUNT FOR WHICH THE PROPERTY COULD REASONABLY BE EXPECTED TO BE REPAIRED TO ITS CONDITION IMMEDIATELY PRIOR TO LOSS; (c) THE AMOUNT FOR WHICH THE ARTICLE COULD REASONABLY BE EXPECTED TO BE REPLACED WITH ONE SUBSTANTIALLY IDENTICAL TO THE ARTICLE LOST OR DAMAGED; OR (d) THE AMOUNT OF INSURANCE.
There is nothing in the policy that provides for depreciating the amount of settlement and providing the rest once the item has been replaced. The full amount as governed by the loss settlement provisions should be paid. Your form may be different and we're happy to review it, but many carriers use the standard language.