Property Damage Claim Value Estimator
Estimate the net payout for a property damage insurance claim using actual cash value (ACV) or replacement cost value (RCV) methodology, accounting for depreciation, deductible, and policy limits.
Formulas Used
Actual Cash Value (ACV):
ACV = Repair Cost × (1 − Depreciation Rate)
Coinsurance Penalty (if coverage limit < required coverage):
Coinsurance Factor = Coverage Limit ÷ (Property Value × Coinsurance %)
Adjusted Loss = Base Value × Coinsurance Factor
Net Payout:
Net Payout = MIN( MAX(Adjusted Loss − Deductible, 0), Coverage Limit )
Replacement Cost Value (RCV): No depreciation is deducted. The insurer pays the full repair/replacement cost (minus deductible and subject to coverage limit). Many insurers pay ACV first, then release the depreciation holdback after repairs are completed.
Assumptions & References
- Depreciation is applied as a flat percentage of repair cost (simplified straight-line proxy). Actual depreciation schedules vary by insurer and item category.
- The coinsurance clause formula follows the standard insurance industry "insurance-to-value" rule: if you insure for less than the required percentage of the property's value, you bear a proportional share of any loss.
- Deductible is subtracted after the coinsurance adjustment, consistent with standard policy language.
- The net payout is capped at the policy's coverage limit.
- This estimator does not account for additional coverages (e.g., loss of use, code upgrade, ordinance/law), sub-limits, or endorsements.
- References: ISO Property Loss Costs; NAIC Property & Casualty Insurance Model; Coinsurance clause per standard ISO HO-3 / CP 00 10 policy forms.
- Results are estimates only. Actual claim settlements are determined by the insurer's adjuster and policy terms.