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Most condominium policies cover appliances!

But, be sure to confirm that by checking your policy or calling your agent. What can come to issue is the type of coverage that you have for appliances. You’ll want to know that.

Actual cash value coverage

If you’ve been in the same condo for 10 years with appliances that are 10-years-old, and your coverage is for actual cash value, depreciation applies. You’re not going to be getting much for any appliances that are damaged, lost or destroyed by a covered risk. Courts have generally held actual cash value to be the cost of replacing of an item with an item of like kind and quality while calculating depreciation into the final number. After figuring in depreciation and your deductible, you’re likely to be paying significant out-of-pocket expenses to replace those appliances.

Replacement cost coverage

Look at your policy or contact your agent to see how replacement cost coverage is defined too. The general concept is that replacement cost coverage is the cost to repair or replace the appliances with appliances that are comparable in material, quality and function, so long as the appliance were damaged, lost or destroyed by a covered risk. You’ll also have a policy limit on replacement cost coverage. The cost of repair or replacement can’t be in excess of your policy limit.

So what distinguishes one from the other?

The only significant distinction between actual cash value and replacement cost coverage is depreciation. Both contemplate replacing the appliances with new appliances, but replacement cost coverage doesn’t consider depreciation. Make sure you have sufficient coverage though.

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