Recoverable Depreciation
Collect The Second Check
RCV claims pay in two parts: the depreciated first check, and the held-back depreciation released when work completes. The second check has paperwork and a deadline — and it gets forfeited constantly.
Why Your First Check Was Small
On a Replacement Cost policy the carrier first pays Actual Cash Value — replacement cost minus depreciation for age. The withheld difference is recoverable depreciation, released only when you prove the work happened at the claimed scope. A $20,000 roof claim might arrive as $12,000 now, $8,000 “recoverable” — and that $8,000 stays with the carrier until the certificate of completion and final invoice land on the right desk. Homeowners who pocket check one and patch cheap forfeit check two by design.
The Paperwork & The Clock
Release takes a completion package: certificate of completion, final invoice matching the approved scope, and often photos — filed before the policy deadline, commonly 180 days to a year after the loss or the ACV payment. We file it on every claim job as routine, because a forfeited deadline turns your RCV policy into an ACV policy retroactively. If a deadline is looming on a stalled project, extensions can be requested in writing — another thing that has to happen before, not after.
What Policyholders Ask Us Daily
How do I know if depreciation is being withheld?
Your claim summary shows it as a line: RCV, less depreciation, equals ACV paid. If those words appear, a second check exists.
What’s the deadline to recover it?
Policy-specific — commonly 180 days to a year from the loss date or ACV payment. We read yours and calendar it on day one; October deadlines on winter losses sneak up fast.
Can I collect depreciation if I do the work myself?
Generally you must prove completion at claimed scope with documentation; DIY makes that harder and some carriers scrutinize it heavily. Ask before you swing a hammer.
What if my project costs less than the claim?
Carriers release depreciation against actual completed scope — another reason the approved scope and the contract should match, which is how we build every claim job.
What happens to recoverable depreciation if I don’t use it?
It stays with the carrier and expires at your policy’s deadline — commonly 180 days to a year — converting your RCV policy into ACV retroactively.
Is recoverable depreciation taxable?
Insurance proceeds restoring your property generally aren’t taxable income — but that’s a question for your tax professional, and worth asking with the claim summary in hand.
Can recoverable depreciation exceed the repair cost?
Release tracks actual completed scope — the carrier pays depreciation against work performed, which is why contract and approved scope should mirror each other.
Does depreciation apply to labor or just materials?
Carrier practices vary and some states restrict labor depreciation — your claim summary shows how yours was computed, and it’s worth reading before accepting the math.
The Full Money Picture
Everything a complete claim collects.
Is A Second Check Waiting?
Free claim-summary review — we’ll find withheld depreciation and the deadline attached to it.