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Replacement cost coverage is an endorsement (a change) to your homeowners policy. It allows you to obtain replacement cost coverage (RCC) instead of actual cost coverage (ACV) when your personal property (PP) is damaged.

Generally, homeowners policies provide for ACV coverage for your PP. That means your insurance company deducts depreciation from the value of your damaged PP. For example, you own a guitar that you bought for $500 three years ago. That guitar was destroyed in a house fire, so you make a claim with your insurance company for the guitar. Because the guitar was three years old, however, you don’t get $500 from the insurance company; they give you $100. That’s depreciation. Think of it as “wear and tear” on your PP.

If you have a RCC endorsement to your policy, that means you get RCC, not ACV, for that guitar. You’re entitled to be paid whatever amount it takes to replace that guitar. That could be $300, $500, or $750.

Here’s where it gets complicated. Most homeowners policies state that, even if you have RCC, you’re only entitled to ACV unless and until  you actually replace the item. Consider again the guitar.  The insurance pays you $100. You take that $100 and another $600 from your own money to buy a replacement. Then send the receipt to your insurance company. They should insurance pay you $500 (e.g. $600 less the $100 already paid). That’s RCC.

Know, however, that generally there are strict timelines in regard to payment of ACV and then RCC. Remember too that ACV means “fair market value.” Make sure your insurance company pays you what it should.

Questions? Contact Me for a free consultation.

Evan Walker

Evan W. Walker is a La Jolla attorney who has practiced law since 2008. He has practiced law throughout California, Connecticut, and Louisiana.

Evan worked for and defended insurance companies during the first 7 years of his practice. Since 2015, he has represented people with personal injury and property damage claims and insurance disputes.

Evan’s practice is devoted to serious personal injury claims and catastrophic property damage claims. Areas of focus include security claims against bars and other businesses, government tort claims, fire and flood claims, and inverse condemnation. On behalf of clients, Evan has fought insurance firms, international companies, cities, bars, and casinos.

Evan regularly shares his expertise with other attorneys by teaching courses on insurance and inverse condemnation. He has taught several continuing legal education courses to Attorney Credits, a nationwide CLE company, and ProLawCLE, another nationwide CLE company. He also contributes to various podcasts and publications.


  • Member, State Bar of California
  • Member, San Diego Bar Association
  • Member, Consumer Attorneys of California
  • Member, Consumer Attorneys of San Diego
  • Member, La Jolla Bar Association
  • Member, La Jolla Village Merchants Association
  • Member, San Diego Chamber of Commerce