The building
Most Washington homeowners policies insure the dwelling at replacement cost: the cost to rebuild with like kind and quality today, up to the dwelling limit. The carrier typically pays actual cash value first, the replacement cost less depreciation, and releases the depreciation as the rebuild is completed and documented. If the rebuild costs more than the dwelling limit, extended replacement cost endorsements add a percentage; ordinance or law coverage pays code-required upgrades. If you choose not to rebuild, or to rebuild elsewhere, many policies pay only actual cash value.
Contents
Personal property is paid on the inventory, item by item, at actual cash value first. Replacement cost policies release the withheld depreciation as you replace items and submit receipts. ACV-only policies stop at the depreciated figure. Sub-limits apply to jewelry, firearms, cash, collectibles and similar categories.
Collecting recoverable depreciation
Keep every receipt for replaced items and every contractor invoice. Submit them before the deadline, which is in your policy and often extendable in writing. Replacing an item with a much cheaper one forfeits the difference; replacing with an equivalent collects it. On the building, the contractor's final invoice and inspections trigger the release.
The deadlines that catch people
Recoverable depreciation windows. Proof of loss deadlines, which in Washington are typically set by the policy with the carrier required to provide forms. Appraisal and suit limitation periods for disputes. Ask your adjuster for each date in writing and note them.
Mortgaged homes
Building payments are usually issued to you and your mortgage servicer jointly; the servicer releases funds in draws against inspections. Contact them early and ask for their process.
