The Louisiana Department of Insurance (LDI) is reminding residents to review and assess their roof insurance coverage ahead of the 2023 Atlantic Hurricane Season, which begins June 1.
LDI recommends policyholders review their policy to see what deductibles they have and how much they would be responsible to cover out of pocket in the event of a total loss. There is a difference in how a claim will be paid if a policy covers your home or personal property for its actual cash value (ACV) or replacement cost (RC). Actual cash value is the value of your home or personal property considering its age and wear and tear, while replacement cost is the cost to rebuild your home or repair damages using materials of a like kind and quality.
LDI recommends contacting an agent or check one’s homeowners policy to see if it provides replacement cost coverage. If it does not specify replacement cost, a policy likely only covers actual cash value. Under an ACV or RC policy, coverage pays for damage to the structure and will pay only up to the policy limit.
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