I have a Homeowners claim with Allstate, they are using personal property sale prices as Replacement Cost. I have never had this issue. Is this acceptable? Personal property that is a total loss. Many items were burnt beyond recognition. Our claim is $181,000; I'm not sure what amount is based on the sales price. The claim is over a year old. $112,000 has been paid.
The RCV is based on a sales price, not the normal retail price.
Insured may or may not replace items in question.
The personal property RCV and ACV have been agreed to at different times over the last year. Items were left open because of Allstate delays.
Arizona Subscriber
The loss provisions state that for personal property actual cash value is paid if the insured does not repair or replace the damaged property. If the insured repairs/replaces the damaged property within 180 days, the difference in value may be paid.While the policy does not define how actual cash value is determined, a sale price is a temporary reduction in value for a limited period of time. It is not fair to use a sale price that expires in a week to determine the actual cash value of property that may not be replaced for several months depending on the nature of the loss. If the house and belongings burned, the insured is not going to replace the furniture now and put it in storage until the house is rebuilt; that does not make sense, even though there may be sales now.
The fact that there have been delays by the company only strengthens the position that using a temporary sales price to value items which would force the insured to immediately buy them is unfair to the insured. Also, the insurer would then have to pay to store them for the length of time the house is being rebuilt. That would inevitably cost more than paying the retail price when the insured is ready to replace. Now, for items the insured is not replacing, payment is actual cash value. The insured has 180 days from the date of that ACV payment to replace items and receive the difference between ACV and RCV.