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DON’T LET YOUR BUILDER’S RISK INSURANCE COMPANY DEPRECIATE YOUR BUSINESS INTERRUPTION OR RENTAL INCOME LOSSES

Construction Industry Advisor

  • Published On: June 6, 2023

Key Points:

  • In claims under builder’s risk insurance policies, insurance companies often attempt to reduce business interruption and rental income recoveries by deducting depreciation as a “noncontinuing expense.”
  • A majority of courts have ruled that depreciation is not a non-continuing expense that should be deducted.
  • Business interruption and rental income coverages are designed to protect cash flow, and because depreciation is an accounting device unrelated to cash flow, it should not be deducted.
Related People
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Dennis J. Artese
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