The portion of your insurance claim that is withheld initially and paid after repairs are completed — representing the difference between Actual Cash Value and Replacement Cost Value.
Table of Contents
- What Recoverable Depreciation Is
- How Recoverable Depreciation Works
- How It Is Calculated
- How to Recover It
- When You Get Paid
- Common Problems
- Common Questions
- How Claim Advocacy Helps
- Related Glossary Terms
What Recoverable Depreciation Is
Recoverable depreciation is the portion of your claim that your insurance company holds back until you complete repairs.
It represents the difference between:
In simple terms: it’s money you only get after you fix your roof.
How Recoverable Depreciation Works
Most RCV policies use a two-payment system:
Payment #1 — ACV (Initial Check)
- Paid when claim is approved
- RCV minus depreciation minus deductible
Payment #2 — Recoverable Depreciation
- Paid after repairs are completed
- Requires proof of work and payment
This system ensures the work is actually completed before full payment is released.
How It Is Calculated
Basic formula:
- Recoverable Depreciation = RCV – ACV
Example:
- RCV: $25,000
- Depreciation: $12,500
- ACV: $12,500
- Deductible: $2,000
Payments:
- Initial ACV check: $10,500
- Recoverable depreciation: $12,500
Total received: $23,000 (RCV minus deductible)
How to Recover It
- Complete the roof replacement
- Collect documentation:
- Paid invoice (showing $0 balance)
- Proof of payment
- Completion documentation
- Photos if required
- Submit to your insurance carrier
- Follow up until processed
If you don’t submit documentation, you don’t get paid.
When You Get Paid
Typical timeline:
- Claim approved → ACV paid
- Roof replaced → documentation submitted
- 2–4 weeks → recoverable depreciation paid
Most claims are fully paid within 2–3 months.
Common Problems
Missed Deadlines
Policies often require completion within 6–12 months.
Incomplete Documentation
Missing invoices or proof of payment delays or denies payment.
Lower Contractor Cost
If you spend less than RCV, you only get reimbursed for actual cost.
Scope Mismatch
If work doesn’t match the approved Scope of Loss, payment may be reduced.
Carrier Delays
Some insurers delay processing — requiring follow-up.
These are some of the most common ways homeowners lose money.
Common Questions
What happens if I never submit for recoverable depreciation?
You forfeit it.
Can I do the work myself?
Usually no — most carriers require contractor documentation.
Does it count toward my deductible?
No — the deductible is already applied to ACV.
Can it be denied?
Yes — if deadlines, documentation, or scope requirements are not met.
How Claim Advocacy Helps
- Deadline tracking — preventing forfeiture
- Documentation preparation — ensuring approval
- Scope alignment — matching approved work
- Supplement support — increasing total depreciation
- Carrier follow-up — preventing delays
Related Glossary Terms
- Actual Cash Value (ACV)
- Replacement Cost Value (RCV)
- Depreciation
- Scope of Loss
- Supplemental Claim
- Settlement
- Deductible
Recoverable depreciation is one of the largest portions of your claim — and one of the easiest to lose. Understanding how it works, meeting deadlines, and submitting proper documentation ensures you receive the full value your policy provides.
📞 (719) 210-8699
📧 gerald@winik.io