Depreciation of Labor

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PROPERTY IN 60 SECONDS: ILLINOIS SUPREME COURT ADDRESSES DEPRECIATION OF LABOR

The ability of an insurance carrier to depreciate labor costs when determining Actual Cash Value (“ACV”) varies from state to state, with a number of states yet to weigh in.  On September 23, 2021, the Supreme Court of Illinois provided definitive guidance in Sproull v. State Farm Fire & Cas. Co., affirming the appellate court, and …

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SURVEY OF STATE LAW ON DEPRECIATION OF LABOR IN DETERMINATION OF ACTUAL CASH VALUE

Alabama – Maybe – Where an insurance policy defined actual cash value as replacement cost less an allowance for physical deterioration and depreciation, including obsolescence, depreciation of labor was permitted. See Ware v. Metropolitan Prop. & Cas. Ins. Co., 220 F.Supp.3d 1288 (M.D.Ala. 2016). However, in Arnold v. State Farm Fire & Cas. Co., 2017 …

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