Property Insurance: Complex Loss Valuation Claims and Avoiding Valuation Mistakes

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This CLE course will guide counsel through complex loss valuation issues under property damage policies when property - including real property and improvements - has been partially or completely destroyed. The program will discuss the methods for calculating replacement cost value (RCV) and actual cash value (ACV) losses, highlight and discuss special considerations and problems that arise when valuing certain types of losses, and review relevant case law. The panel will also offer best practices for avoiding common valuation errors and how insurance counsel can manage policyholder expectations.

The goal of property insurance is to protect the insured when there is a covered loss by returning the insured to essentially the same condition (financial or otherwise) enjoyed before the loss. The insured and the insurance company often have differing views about how to determine value.

The typical property policy will pay the insured the ACV of the loss, but many policies do not define "actual cash value," leading to litigation. Property owners can purchase RCV policies, but the insurer is often obligated to make an upfront payment based on the estimated ACV. And what constitutes "replacement" can be a complex and disputed issue. Equally critical is avoiding valuation mistakes.

Listen as our experienced panel brings clarity to this complicated and often litigated issue of value property losses.