Do you know your true value?

Replacement cost or actual cash value-these are the two key options that determine how much you're entitled to claim. To find which you qualify for, see the "Particulars" section of your insurance policy.

• If you have replacement cost insurance, you can replace a damaged item with a similar new one without accounting for depreciation.
• This coverage only applies if you actually replace the item.
• For your home, replacement cost means the cost of rebuilding or repairing. Three conditions apply: you must repair or rebuild in the same location using materials of the same nature and quality, the building's use must remain the same, and you must have enough insurance.
• For your personal property, replacement cost means repairing or replacing the damaged article with one of the same nature and quality.
• Replacement cost insurance lets you replace a damaged item with a similar item, even if it's more expensive than the original.
• Example of replacement cost
  

  Amount paid for a refrigerator ten years ago	$800
  Current cost of a refrigerator with the same features	$1,000
  Total compensation	$1,000

• If you don't have replacement cost insurance or you choose not to repair or replace an item, you will be compensated according to its actual cash value on the day the damage occurred, after depreciation.
• Depreciation is based on the number of years the item has been used. It's calculated differently for various property categories and takes into account factors such as the condition of the item, its resale value, and its normal useful lifespan.
• For your home, actual cash value is established according to the cost of rebuilding the dwelling, after depreciation.
• For personal property, actual cash value is the replacement cost minus depreciation.
• Example of actual cash value
  

  Amount paid for a refrigerator ten years ago	$800
  Current cost of a refrigerator with the same features	$1,000
  Depreciation ($40/year for ten years)	$400
  Total compensation ($1,000 - $400)	$600