On July 3, 2024, the Michigan Department of Insurance and Financial Services (DIFS) issued a bulletin, which expressly prohibits insurance companies from depreciating labor when calculating actual cash value (ACV), unless the insured as agreed to the depreciation of labor in exchange for a lower premium. According to DIFS: ACV is ordinarily understood to mean …
A federal district court in Texas has become the latest to weigh in on whether insurance carriers may depreciate labor when determining the Actual Cash Value (“ACV”) of a loss. On January 11, 2023, in Sims v. Allstate Fire, the U.S. District Court for the Western District of Texas was asked to decide whether labor could be …
Property in 60 Seconds: Texas Federal Court Addresses Depreciation of Labor Read More »
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 …
PROPERTY IN 60 SECONDS: ILLINOIS SUPREME COURT ADDRESSES DEPRECIATION OF LABOR Read More »
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 …
SURVEY OF STATE LAW ON DEPRECIATION OF LABOR IN DETERMINATION OF ACTUAL CASH VALUE Read More »
