Auto InsuranceQuestion 17 of 215
How are physical damage losses normally settled under the Personal Auto Policy Part D?
a.Replacement cost without depreciation
b.Actual cash value (ACV) or cost to repair, whichever is less, minus the deductible
c.Agreed value listed on the declarations
d.Stated amount with no consideration of depreciation
Explanation
Unless an optional endorsement (such as Auto Loan/Lease Coverage CA 23 04 or Replacement Cost endorsement) is added, Part D pays the lower of (a) the actual cash value (ACV) of the damaged property or (b) the amount necessary to repair or replace the property with like kind and quality, less the applicable deductible. ACV is generally market or book value at the time of loss, taking depreciation into account.
Law Reference: ISO PAP Part D loss settlement; ACV principlePractice all 215 questions free — no signup required.
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